As filed with the Securities and Exchange Commission on June 17, 1997
Registration Nos. 333-25829 and 333-25829-01
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 1 TO
FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
----------------------------
U. S. BANCORP U. S. BANCORP CAPITAL I
(Exact name of Registrant as (Exact name of Registrant as
specified in its charter) specified in its trust agreement)
OREGON DELAWARE
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
------ ------
6711 6719
(Primary Standard Industrial (Primary Standard Industrial
Classification Code Number) Classification Code Number)
93-0571730 Not Yet Available
(I.R.S. Employer Identification (I.R.S. Employer Identification
No.) No.)
----------------------------
111 S.W. Fifth Avenue
Portland, Oregon 97204
(503) 275-6111
(Address, including zip code, and telephone number, including area code, of
Registrants' principal executive offices)
----------------------------
Dwight V. Board C. Marie Eckert
Executive Vice President Attorney
U. S. Bancorp U. S. Bancorp
111 S.W. Fifth Avenue 111 S.W. Fifth Avenue
Portland, Oregon 97204 Portland, Oregon 97204
(503) 275-3706 (503) 275-6182
(Name, address, including zip code, and telephone number, including
area code, of agents for service)
----------------------------
COPIES TO:
Mary Ann Frantz, Esq. Paul C. Pringle, Esq.
Miller, Nash, Wiener, Brown & Wood LLP
Hager & Carlsen LLP 555 California Street
111 S.W. Fifth Avenue, 35th Fl. San Francisco, California
Portland, Oregon 97204-3699 94104-1715
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Approximate Date of Commencement of Proposed Sale to the Public:
As soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered
in connection with the formation of a holding company and there is compliance
with General Instruction G, check the following box. [ ]
----------------------------
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 Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
SUBJECT TO COMPLETION, DATED JUNE 17, 1997
PROSPECTUS
U. S. BANCORP CAPITAL I
OFFER TO EXCHANGE ITS
8.27% CAPITAL SECURITIES, SERIES B
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
8.27% CAPITAL SECURITIES, SERIES A
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
U. S. BANCORP
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW
YORK CITY TIME, ON JULY __, 1997, UNLESS EXTENDED.
----------------------------
U. S. Bancorp Capital I, a statutory business trust created under the laws
of the State of Delaware (the "Trust"), hereby offers, upon the terms and
subject to the conditions set forth in this Prospectus (as the same may be
amended or supplemented from time to time, the "Prospectus") and in the
accompanying Letter of Transmittal (which together constitute the "Exchange
Offer"), to exchange up to $300,000,000 aggregate Liquidation Amount of its
8.27% Capital Securities, Series B (the "New Capital Securities"), which have
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), pursuant to a Registration Statement (as defined herein) of which this
Prospectus constitutes a part, for a like Liquidation Amount of its outstanding
8.27% Capital Securities, Series A (the "Old Capital Securities"), of which
$300,000,000 aggregate Liquidation Amount is outstanding. Pursuant to the
Exchange Offer, U. S. Bancorp, an Oregon corporation, is also offering to
exchange (i) its guarantee of payments of cash distributions and payments on
liquidation of the Trust or redemption of the New Capital Securities (the "New
Guarantee") for a like guarantee in respect of the Old Capital Securities (the
"Old Guarantee") and (ii) all of its 8.27% Junior Subordinated Deferrable
Interest Debentures due December 15, 2026, to be issued pursuant to an indenture
to be entered into between U. S. Bancorp and The First National Bank of Chicago,
as trustee (the "New Junior Subordinated Debentures") for a like aggregate
principal amount of its 8.27% Junior Subordinated Deferrable Interest Debentures
due December 15, 2026, issued pursuant to an Indenture dated December 24, 1996,
between U. S. Bancorp and The First National Bank of Chicago, as trustee (the
"Old Junior Subordinated Debentures"). The New Guarantee and New Junior
Subordinated Debentures have also been registered under the Securities Act. The
Old Capital Securities, the Old Guarantee and the Old Junior Subordinated
Debentures are collectively referred to herein as the "Old Securities" and the
New Capital Securities, the New Guarantee and the New Junior Subordinated
Debentures are collectively referred to herein as the "New Securities."
The terms of the New Securities are identical in all material respects to
the respective terms of the Old Securities, except that (i) the New Securities
have been registered under the Securities Act and therefore will
(Continued on the following page)
SEE "RISK FACTORS" COMMENCING ON PAGE __ FOR CERTAIN INFORMATION THAT
SHOULD BE CONSIDERED BY HOLDERS IN DECIDING WHETHER TO TENDER OLD CAPITAL
SECURITIES IN THE EXCHANGE OFFER.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
The date of this Prospectus is June __, 1997.
<PAGE>
(Continued from the previous page)
not be subject to certain restrictions on transfer applicable to the Old
Securities and (ii) the New Capital Securities will not provide for any increase
in the Distribution rate thereon and the New Junior Subordinated Debentures will
not provide for any increase in the interest rate thereon, in each case in
connection with the Exchange Offer. See "Description of New Securities" and
"Description of Old Securities." The New Capital Securities are being offered
for exchange in order to satisfy certain obligations of U. S. Bancorp and the
Trust under the Registration Rights Agreement dated as of December 24, 1996 (the
"Registration Rights Agreement") among U. S. Bancorp, the Trust and Goldman
Sachs & Co., Lehman Brothers Inc., and Salomon Brothers Inc (the "Initial
Purchasers"). In the event that the Exchange Offer is consummated, any Old
Capital Securities which remain outstanding after consummation of the Exchange
Offer and the New Capital Securities issued in the Exchange Offer will vote
together as a single class for purposes of determining whether holders of the
requisite percentage in outstanding Liquidation Amount thereof have taken
certain actions or exercised certain rights under the Trust Agreement.
The New Capital Securities and the Old Capital Securities (collectively,
the "Capital Securities") represent preferred undivided beneficial interests in
the assets of the Trust. U. S. Bancorp is the owner of all of the beneficial
interests represented by common securities of the Trust (the "Common
Securities," and together with the Capital Securities, the "Trust Securities").
The First National Bank of Chicago is the Property Trustee of the Trust. The
Trust exists for the sole purpose of issuing the Trust Securities and investing
the proceeds thereof in the Junior Subordinated Debentures (as defined herein).
The Junior Subordinated Debentures will mature on December 15, 2026, subject to
U. S. Bancorp's right to shorten the maturity (the "Stated Maturity"). See
"Description of New Securities--Description of New Capital Securities--Right to
Shorten Maturity." The Capital Securities will have a preference over the Common
Securities under certain circumstances with respect to cash distributions and
amounts payable on liquidation, redemption or otherwise. See "Description of New
Securities--Description of New Capital Securities--Subordination of Common
Securities." The Capital Securities are issuable, and may be held or
transferred, only in blocks having a Liquidation Amount of not less than
$100,000 (100 Capital Securities). Accordingly, any holder must own at least 100
Capital Securities. Any transfer, sale or other disposition of New Capital
Securities in a block having a Liquidation Amount of less than $100,000, or
resulting in a holder's holding New Capital Securities in a block having a
Liquidation Amount of less than $100,000, will be deemed to be void and of no
legal effect whatsoever.
As used herein, (i) the "New Indenture" means the indenture to be entered
into between U. S. Bancorp and The First National Bank of Chicago, as Trustee
(the "Debenture Trustee"), as amended and supplemented from time to time,
relating to the New Junior Subordinated Debentures, (ii) the "Old Indenture"
means the Indenture, dated as of December 24, 1996, as amended and supplemented
from time to time, between U. S. Bancorp and The First National Bank of Chicago,
as Debenture Trustee, relating to the Old Junior Subordinated Debentures, and
(iii) the "Trust Agreement" means the Amended and Restated Trust Agreement,
dated as of December 24, 1996, among U. S. Bancorp, as Depositor, the First
National Bank of Chicago as Property Trustee (the "Property Trustee"), First
Chicago Delaware Inc., as Delaware Trustee (the "Delaware Trustee"), and the
Administrative Trustees named therein (collectively, with the Property Trustee
and the Delaware Trustee, the "Issuer Trustees"). In addition, as the context
may require, unless otherwise expressly stated, (i) the term "Junior
Subordinated Debentures" includes the Old Junior Subordinated Debentures and the
New Junior Subordinated Debentures, (ii) the term "Indenture includes the Old
Indenture and the New Indenture, and (iii) the term "Guarantee" includes the Old
Guarantee and the New Guarantee.
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<PAGE>
(Continued from the previous page)
Holders of the New Capital Securities will be entitled to receive
preferential cumulative cash distributions arising from the payment of interest
on the Junior Subordinated Debentures, accruing from June 15, 1997, and payable
semi-annually in arrears on June 15 and December 15 of each year, commencing
December 15, 1997, at the annual rate of 8.27% of the Liquidation Amount of
$1,000 per New Capital Security ("Distributions"). Subject to certain
exceptions, as described herein, U. S. Bancorp has the right to defer payment of
interest on the Junior Subordinated Debentures at any time and from time to time
for a period not exceeding 10 consecutive semi-annual periods with respect to
each deferral period (each, an "Extension Period"), provided that no Extension
Period may extend beyond the Stated Maturity. Upon the termination of any such
Extension Period and the payment of all amounts then due, U. S. Bancorp may
elect to begin a new Extension Period, subject to the requirements set forth in
the Indenture. If and for so long as interest payments on the Junior
Subordinated Debentures are so deferred, Distributions on the Capital Securities
will also be deferred and U. S. Bancorp will not be permitted, subject to
certain exceptions described herein, to declare or pay any dividends,
distributions or other payments with respect to, or repay, repurchase, redeem or
otherwise acquire, U. S. Bancorp's capital stock or debt securities that
rank pari passu with or junior to the Junior Subordinated Debentures. During an
Extension Period, interest on the Junior Subordinated Debentures will continue
to accrue (and the amount of Distributions to which holders of the Capital
Securities are entitled will accumulate) at the rate of 8.27% per annum,
compounded semi-annually, and holders of Capital Securities will be required to
accrue interest income for United States federal income tax purposes. See
"Description of New Securities--Description of New Junior Subordinated
Debentures--Option to Defer Interest Payments" and "--Restrictions on Certain
Payments" and "Certain Federal Income Tax Consequences--Interest Income and
Original Issue Discount."
Through the Guarantee, the Trust Agreement, the Junior Subordinated
Debentures, the Indenture, and the Expense Agreement (as defined herein), taken
together, U. S. Bancorp has guaranteed or will guarantee, as the case may be,
fully, irrevocably and unconditionally, all of the Trust's obligations under
the Capital Securities. See "Relationship Among the New Capital Securities, the
New Junior Subordinated Debentures, the New Guarantee and the Expense
Agreement--Full and Unconditional Guarantee." The Old Guarantee guarantees, and
the New Guarantee will guarantee, payments of Distributions and payments on
liquidation or redemption of the Capital Securities, but in each case only to
the extent that the Trust holds funds on hand available therefor and has failed
to make such payments, as described herein. See "Description of New
Securities--Description of New Guarantee." If U. S. Bancorp fails to make a
required payment on the Junior Subordinated Debentures, the Trust will not have
sufficient funds to make the related payments, including Distributions, on the
Capital Securities. The Guarantee will not cover any such payment when the Trust
does not have funds sufficient to make such payments. In such event, a holder of
Capital Securities may institute a legal proceeding directly against U. S.
Bancorp to enforce its rights in respect of such payment. See "Description of
New Securities--Description of New Junior Subordinated Debentures--Enforcement
of Certain Rights by Holders of New Capital Securities." The obligations of U.
S. Bancorp under the Guarantee and the Junior Subordinated Debentures will be
unsecured and subordinate and junior in right of payment to all Senior Debt (as
defined in "Description of New Securities--Description of New Junior
Subordinated Debentures--Subordination") of U. S. Bancorp.
The Capital Securities are subject to mandatory redemption, in whole or in
part, upon repayment of the Junior Subordinated Debentures at Stated Maturity or
their earlier redemption. Subject to U. S. Bancorp having received prior
approval of the Board of Governors of the Federal Reserve System (the "Federal
Reserve") to do so if then required under applicable capital guidelines or
policies of the Federal Reserve, the Junior Subordinated
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<PAGE>
(Continued from the previous page)
Debentures are redeemable prior to their Stated Maturity at the option of U. S.
Bancorp (i) on or after December 15, 2006, in whole at any time or in part from
time to time or (ii) in whole (but not in part), at any time within 90 days
following the occurrence and continuation of a Tax Event or a Capital Treatment
Event (each as defined herein). For a description of redemption prices for the
Capital Securities pursuant to clause (i) or (ii) above, see "Description of New
Securities--Description of New Capital Securities--Redemption."
Under certain circumstances in which a Tax Event would otherwise occur, U.
S. Bancorp also has the right, subject to prior approval of the Federal Reserve
if then required under applicable capital guidelines or policies of the Federal
Reserve, to shorten the maturity of the Junior Subordinated Debentures to a date
not earlier than June 24, 2016, which will result in redemption of the Capital
Securities as of such earlier maturity. See "Description of New
Securities--Description of New Capital Securities--Right to Shorten Maturity."
U. S. Bancorp, as the holder of the outstanding Common Securities, has the
right at any time to terminate the Trust, subject to U. S. Bancorp having
received prior approval of the Federal Reserve to do so if then required under
applicable capital guidelines or policies of the Federal Reserve. In the event
of the termination of the Trust, after satisfaction of liabilities to creditors
of the Trust as required by applicable law and subject to the Expense Agreement,
the holders of the Capital Securities will be entitled to receive a Liquidation
Amount of $1,000 per Capital Security plus accumulated and unpaid Distributions
thereon to the date of payment, which may be in the form of a distribution of
such amount in Junior Subordinated Debentures in exchange therefor, subject to
certain exceptions. See "Description of New Securities--Description of New
Capital Securities--Liquidation Distribution Upon Termination."
----------------------------
The Trust is making the Exchange Offer of the New Capital Securities in
reliance on the position of the staff of the Division of Corporation Finance of
the Securities and Exchange Commission (the "Commission") as set forth in
certain interpretive letters addressed to third parties in other transactions.
However, neither U. S. Bancorp nor the Trust has sought its own interpretive
letter and there can be no assurance that the staff of the Division of
Corporation Finance of the Commission would make a similar determination with
respect to the Exchange Offer as it has in such interpretive letters to third
parties. Based on these interpretations by the staff of the Division of
Corporation Finance of the Commission, and subject to the two immediately
following sentences, U. S. Bancorp and the Trust believe that New Capital
Securities issued pursuant to this Exchange Offer in exchange for Old Capital
Securities may be offered for resale, resold and otherwise transferred by a
holder thereof (other than a holder who is a broker-dealer) without further
compliance with the registration and prospectus delivery requirements of the
Securities Act, provided that such New Capital Securities are acquired in the
ordinary course of such holder's business and that such holder is not
participating, and has no arrangement or understanding with any person to
participate, in a distribution (within the meaning of the Securities Act) of
such New Capital Securities. However, any holder of Old Capital Securities who
is an "affiliate", as such term is defined in Rule 405 under the Securities Act
(an "Affiliate"), of U. S. Bancorp or the Trust or who intends to participate in
the Exchange Offer for the purpose of distributing New Capital Securities, or
any broker-dealer who purchased Old Capital Securities from the Trust for resale
pursuant to Rule 144A under the Securities Act ("Rule 144A") or any other
available exemption under the Securities Act, (a) will not be able to rely on
the interpretations of the staff of the Division
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<PAGE>
(Continued from the previous page)
of Corporation Finance of the Commission set forth in the above-mentioned
interpretive letters, (b) will not be permitted or entitled to tender such Old
Capital Securities in the Exchange Offer and (c) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any sale or other transfer of such Old Capital Securities unless
such sale is made pursuant to an exemption from such requirements. In addition,
as described below, if any broker-dealer holds Old Capital Securities acquired
for its own account as a result of market-making or other trading activities and
exchanges such Old Capital Securities for New Capital Securities, then such
broker-dealer must deliver a prospectus meeting the requirements of the
Securities Act in connection with any resales of such New Capital Securities.
Each holder of Old Capital Securities who wishes to exchange Old Capital
Securities for New Capital Securities in the Exchange Offer will be required to
represent that (i) it is not an Affiliate of U. S. Bancorp or the Trust, (ii)
any New Capital Securities to be received by it are being acquired in the
ordinary course of its business, (iii) it has no arrangement or understanding
with any person to participate in a distribution (within the meaning of the
Securities Act) of such New Capital Securities, and (iv) if such holder is not a
broker-dealer, such holder is not engaged in, and does not intend to engage in,
a distribution (within the meaning of the Securities Act) of such New Capital
Securities. In addition, U. S. Bancorp and the Trust may require such holder, as
a condition to such holder's eligibility to participate in the Exchange
Offer, to furnish to U. S. Bancorp and the Trust (or an agent thereof) in
writing information as to the number of "beneficial owners" (within the meaning
of Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) on behalf of whom such holder holds the Old Capital Securities
to be exchanged in the Exchange Offer. Each broker-dealer that receives New
Capital Securities for its own account pursuant to the Exchange Offer must
acknowledge that it acquired the Old Capital Securities for its own account as
the result of market-making activities or other trading activities and must
agree that it will deliver a prospectus meeting the requirements of the
Securities Act in connection with any resale of such New Capital Securities. The
Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. Based on the position
taken by the staff of the Division of Corporation Finance of the Commission in
the interpretive letters referred to above, U. S. Bancorp and the Trust believe
that broker-dealers who acquired Old Capital Securities for their own accounts,
as a result of market-making activities or other trading activities
("Participating Broker-Dealers"), may fulfill their prospectus delivery
requirements with respect to the New Capital Securities received upon exchange
of such Old Capital Securities (other than Old Capital Securities which
represent an unsold allotment from the original sale of the Old Capital
Securities) with a prospectus meeting the requirements of the Securities Act,
which may be the prospectus prepared for an exchange offer so long as it
contains a description of the plan of distribution with respect to the resale of
such New Capital Securities. Accordingly, this Prospectus, as it may be amended
or supplemented from time to time, may be used by a Participating Broker-Dealer
during the period referred to below in connection with resales of New Capital
Securities received in exchange for Old Capital Securities where such Old
Capital Securities were acquired by such Participating Broker-Dealer for its own
account as a result of market-making or other trading activities. Subject to
certain provisions set forth in the Registration Rights Agreement, U. S. Bancorp
and the Trust have agreed that this Prospectus, as it may be amended or
supplemented from time to time, may be used by a Participating Broker-Dealer in
connection with resales of such New Capital Securities for a period ending 180
days after the Expiration Date (as defined herein) (subject to extension under
certain limited circumstances described below) or, if earlier, when all such New
Capital Securities have been disposed of by such Participating Broker-Dealer.
See "Plan of
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<PAGE>
(Continued from the previous page)
Distribution." However, a Participating Broker-Dealer who intends to use this
Prospectus in connection with the resale of New Capital Securities received in
exchange for Old Capital Securities pursuant to the Exchange Offer must notify
U. S. Bancorp or the Trust, or cause U. S. Bancorp or the Trust to be notified,
on or prior to the Expiration Date, that it is a Participating Broker-Dealer.
Such notice may be given in the space provided for that purpose in the Letter of
Transmittal or may be delivered to the Exchange Agent at one of the addresses
set forth herein under "The Exchange Offer--Exchange Agent." Any Participating
Broker-Dealer who is an Affiliate of U. S. Bancorp or the Trust may not rely on
such interpretive letters and must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any resale
transaction. See "The Exchange Offer--Resales of New Capital Securities."
In that regard, each Participating Broker-Dealer who surrenders Old
Capital Securities pursuant to the Exchange Offer will be deemed to have agreed,
by execution of the Letter of Transmittal, that, upon receipt of notice from U.
S. Bancorp or the Trust of the occurrence of any event or the discovery of any
fact which makes any statement contained or incorporated by reference in this
Prospectus untrue in any material respect or which causes this Prospectus to
omit to state a material fact necessary in order to make the statements
contained or incorporated by reference herein, in light of the circumstances
under which they were made, not misleading or of the occurrence of certain other
events specified in the Registration Rights Agreement, such Participating
Broker-Dealer will suspend the sale of New Capital Securities (or the New
Guarantee or the New Junior Subordinated Debentures, as applicable) pursuant to
this Prospectus until U. S. Bancorp or the Trust has amended or supplemented
this Prospectus to correct such misstatement or omission and has furnished
copies of the amended or supplemented Prospectus to such Participating
Broker-Dealer or U. S. Bancorp or the Trust has given notice that the sale of
the New Capital Securities (or the New Guarantee or the New Junior Subordinated
Debentures, as applicable) may be resumed, as the case may be. If U. S. Bancorp
or the Trust gives such notice to suspend the sale of the New Capital Securities
(or the New Guarantee or the New Junior Subordinated Debentures, as applicable),
it shall extend the 180-day period referred to above during which Participating
Broker-Dealers are entitled to use this Prospectus in connection with the resale
of New Capital Securities by the number of days during the period from and
including the date of the giving of such notice to and including the date when
Participating Broker-Dealers shall have received copies of the amended or
supplemented Prospectus necessary to permit resales of the New Capital
Securities or to and including the date on which U. S. Bancorp or the Trust has
given notice that the sale of New Capital Securities (or the New Guarantee or
the New Junior Subordinated Debentures, as applicable) may be resumed, as the
case may be.
Prior to the Exchange Offer, there has been only a limited secondary
market and no public market for the Old Capital Securities. The New Capital
Securities will be a new issue of securities for which there currently is no
market. Accordingly, there can be no assurance as to the development or
liquidity of any market for the New Capital Securities. U. S. Bancorp and the
Trust currently do not intend to apply for listing of the New Capital Securities
on any securities exchange or for inclusion in The Nasdaq Stock Market, the
Electronic Securities Market operated by the National Association of Securities
Dealers, Inc. ("NASDAQ").
Any Old Capital Securities not tendered and accepted in the Exchange Offer
will remain outstanding and will be entitled to all the same rights and will be
subject to the same limitations applicable thereto under the Trust Agreement
(except for those rights which terminate upon consummation of the Exchange
Offer). Following consummation of the Exchange Offer, the holders of Old Capital
Securities will continue to be subject to all of the existing restrictions upon
transfer thereof and neither U. S. Bancorp nor the Trust
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<PAGE>
(Continued from the previous page)
will have any further obligation to such holders (other than under certain
limited circumstances) to provide for registration under the Securities Act of
the Old Capital Securities held by them. To the extent that Old Capital
Securities are tendered and accepted in the Exchange Offer, a holder's
ability to sell untendered Old Capital Securities could be adversely affected.
See "Risk Factors--Consequences of a Failure to Exchange Old Capital
Securities."
THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION. HOLDERS OF OLD CAPITAL SECURITIES ARE URGED TO READ THE PROSPECTUS
AND THE RELATED LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO
TENDER THEIR OLD CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER.
Old Capital Securities may be tendered for exchange on or prior to 5:00
p.m., New York City time, on July __, 1997 (such time on such date being
hereinafter called the "Expiration Date"), unless the Exchange Offer is extended
by U. S. Bancorp or the Trust (in which case the term "Expiration Date" shall
mean the latest date and time to which the Exchange Offer is extended). Tenders
of Old Capital Securities may be withdrawn at any time on or prior to the
Expiration Date. The Exchange Offer is not conditioned upon any minimum
Liquidation Amount of Old Capital Securities being tendered for exchange.
However, the Exchange Offer is subject to certain events and conditions which
may be waived by U. S. Bancorp or the Trust and to the terms and provisions of
the Registration Rights Agreement. Old Capital Securities may be tendered in
whole or in part in a Liquidation Amount of $100,000 (100 Capital Securities) or
any integral multiple of $1,000 (one Capital Security) in excess thereof;
provided that, if any Old Capital Securities are tendered for exchange in part,
the untendered Liquidation Amount thereof must be $100,000 (100 Capital
Securities) or any integral multiple of $1,000 (one Capital Security) in excess
thereof. U. S. Bancorp has agreed to pay all expenses of the Exchange Offer. See
"The Exchange Offer--Fees and Expenses." Holders of the Old Capital Securities
whose Old Capital Securities are accepted for exchange will not receive any
further Distributions on such Old Capital Securities and will be deemed to have
waived the right to receive any Distributions on such Old Capital Securities
accumulated from and after June 15, 1997. Accordingly, holders of New Capital
Securities as of the record date for payment of Distributions on December 15,
1997, will be entitled to receive Distributions accumulated from and after June
15, 1997. See "The Exchange Offer--Distributions on New Capital Securities."
Neither U. S. Bancorp nor the Trust will receive any cash proceeds from
the issuance of the New Capital Securities offered hereby. No dealer-manager
is being used in connection with this Exchange Offer. See "Use of Proceeds"
and "Plan of Distribution."
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<PAGE>
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NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THIS EXCHANGE
OFFER AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY U. S. BANCORP OR THE TRUST. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY
CIRCUMSTANCE CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS
OF U. S. BANCORP OR THE TRUST SINCE THE DATE HEREOF. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER OR A SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH
SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH
OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
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TABLE OF CONTENTS
Page
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Available Information.......................................................8
Incorporation of Certain Documents by Reference.............................9
Summary.....................................................................9
Risk Factors...............................................................18
U. S. Bancorp Capital I....................................................24
U. S. Bancorp..............................................................24
Certain Regulatory Considerations..........................................25
Ratio of Earnings to Fixed Charges.........................................26
Use of Proceeds............................................................26
Capitalization.............................................................27
The Exchange Offer.........................................................27
Description of New Securities..............................................37
Description of Old Securities..............................................65
Relationship Among the New Capital Securities, the New Junior Subordinated
Debentures, the New Guarantee and the Expense Agreement..................66
Certain Federal Income Tax Consequences....................................67
Certain ERISA Considerations...............................................71
Plan of Distribution.......................................................72
Validity of New Securities.................................................73
Experts....................................................................73
AVAILABLE INFORMATION
U. S. Bancorp is subject to the informational requirements of the Exchange
Act and in accordance therewith files reports, proxy statements and other
information with the Commission. Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities of
the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and
at the regional offices of the Commission located at 7 World Trade Center, 13th
Floor, Suite 1300, New York, New York 10048 and Suite 1400, Citicorp Center,
14th Floor, 500 West Madison Street, Chicago, Illinois 60661. Copies of such
material can also be obtained at prescribed rates by writing to the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549. Such information may also be accessed electronically by means of the
Commission's home page on the Internet (http://www.sec.gov).
No separate financial statements of the Trust have been included herein.
U. S. Bancorp and the Trust do not consider that such financial statements would
be material to holders of the Capital Securities because the Trust is a newly
formed special purpose entity, has no operating history or independent
operations and is not engaged in and does not propose to engage in any activity
other than holding as trust assets the Junior Subordinated Debentures and
issuing the Trust Securities. See "U. S. Bancorp Capital I" and
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"Description of New Securities." In addition, U. S. Bancorp does not expect that
the Trust will file reports under the Exchange Act with the Commission.
This Prospectus constitutes a part of a registration statement on Form S-4
(the "Registration Statement") filed by U. S. Bancorp and the Trust with the
Commission under the Securities Act. This Prospectus does not contain all the
information set forth in the Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the Commission, and
reference is hereby made to the Registration Statement and to the exhibits
relating thereto for further information with respect to U. S. Bancorp, the
Trust and the New Securities. Any statements contained herein concerning the
provisions of any document are not necessarily complete, and, in each instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement or otherwise filed with the Commission. Each such
statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by U. S. Bancorp with the Commission are
incorporated into this Prospectus by reference:
1. U. S. Bancorp's Annual Report on Form 10-K for the year ended December
31, 1996;
2. U. S. Bancorp's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1997; and
3. U. S. Bancorp's Current Reports on Form 8-K dated March 26, 1997 and
June 17, 1997.
All documents subsequently filed by U. S. Bancorp pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to
the termination of the offering of the New Securities offered hereby shall be
deemed to be incorporated by reference into this Prospectus and to be a part of
this Prospectus from the date of filing of such document. Any statement
contained herein or in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
As used herein, the terms "Prospectus" and "herein" mean this Prospectus
including the documents incorporated or deemed to be incorporated herein by
reference, as the same may be amended, supplemented or otherwise modified from
time to time. Statements contained in this Prospectus as to the contents of any
contract or other document referred to herein do not purport to be complete, and
where reference is made to the particular provisions of such contract or other
document, such provisions are qualified in all respects by reference to all of
the provisions of such contract or other document. U. S. Bancorp will provide
without charge to any person to whom this Prospectus is delivered, on the
written or oral request of such person, a copy of any or all of the foregoing
documents incorporated by reference herein (other than exhibits not specifically
incorporated by reference into the texts of such documents). Requests for such
documents should be directed to: Investor Relations, U. S. Bancorp, P.O. Box
8837, Portland, Oregon 97208. Telephone requests may be directed to Investor
Relations at (503) 275-5834.
SUMMARY
The following is a summary of certain information contained elsewhere in
this Prospectus. Reference is made to, and this summary is qualified in its
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entirety by, the more detailed information appearing elsewhere in this
Prospectus.
U. S. BANCORP
U. S. Bancorp is a regional multi-bank holding company headquartered in
Portland, Oregon. At December 31, 1996, U. S. Bancorp was the 26th largest bank
holding company in the United States with consolidated total assets of $33.3
billion. U. S. Bancorp is engaged in a general retail and commercial banking
business in the states of Oregon, Washington, Idaho, California, Nevada, and
Utah through its banking subsidiaries. Other subsidiaries of U. S. Bancorp
provide financial services related to banking including lease financing,
consumer and commercial finance, discount brokerage, investment advisory
services, and insurance agency and credit life insurance services.
On March 20, 1997, U. S. Bancorp and First Bank System Inc. ("FBS")
announced the signing of a definitive agreement for FBS to acquire U. S. Bancorp
for stock valued at approximately $9 billion. The resulting company, which will
be called U. S. Bancorp and will be headquartered in Minneapolis, Minnesota,
will create the 14th largest banking organization in the United States based on
combined assets of approximately $70 billion. The combined company will serve
nearly 4 million households and 475,000 businesses in 17 contiguous states. The
merger is subject to regulatory and shareholder approvals and is expected to
close in the third quarter of 1997. Pro forma financial statements reflecting
the pending merger are incorporated herein by reference to U. S. Bancorp's
Current Report on Form 8-K dated June 17, 1997. See "Incorporation of Certain
Documents by Reference."
U. S. BANCORP CAPITAL I
The Trust is a statutory business trust created under Delaware law
pursuant to the filing of a certificate of trust with the Delaware Secretary of
State and governed by the Trust Agreement. The Trust's business and affairs
are conducted by its trustees: currently, The First National Bank of Chicago, as
Property Trustee, First Chicago Delaware Inc., as Delaware Trustee, and two
individual Administrative Trustees who are employees or officers of U. S.
Bancorp. The Trust exists for the exclusive purposes of (i) issuing and selling
the Trust Securities, (ii) using the proceeds from the sale of the Trust
Securities to acquire the Junior Subordinated Debentures and (iii) engaging in
only those other activities necessary, convenient or incidental thereto (such as
registering the transfer of the Trust Securities). Accordingly, the Junior
Subordinated Debentures and the right to reimbursement under the Expense
Agreement are and will continue to be the sole assets of the Trust, and payments
under the Junior Subordinated Debentures and the Expense Agreement will be the
sole source of revenues of the Trust. All of the Common Securities are owned by
U. S. Bancorp.
THE EXCHANGE OFFER
The Exchange Offer. . . . . . Up to $300,000,000 aggregate Liquidation Amount of
New Capital Securities are being offered in
exchange for a like aggregate Liquidation Amount
of Old Capital Securities. Old Capital Securities
may be tendered for exchange in whole or in part
in a Liquidation Amount of $100,000 (100 Capital
Securities) or any integral multiple of $1,000
(one Capital Security) in excess thereof; provided
that, if any Old Capital Securities are tendered
for exchange in part, the untendered Liquidation
Amount thereof must be $100,000 (100 Capital
Securities) or any integral multiple of $1,000
(one Capital
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Security) in excess thereof. U. S. Bancorp and the
Trust are making the Exchange Offer in order to
satisfy their obligations under the Registration
Rights Agreement relating to the Old Capital
Securities. For a description of the procedures
for tendering Old Capital Securities, see "The
Exchange Offer--Procedures for Tendering Old
Capital Securities."
Expiration Date. . . . . . . 5:00 p.m., New York City time on July __, 1997,
unless the Exchange Offer is extended by U. S.
Bancorp or the Trust (in which case the Expiration
Date will be the latest date and time to which the
Exchange Offer is extended). See "The Exchange
Offer--Terms of the Exchange Offer."
Conditions to the Exchange
Offer. . . . . . . . . . . . The Exchange Offer is subject to certain
conditions, which may be waived by U. S. Bancorp
and the Trust in their sole discretion. The
Exchange Offer is not conditioned upon any minimum
Liquidation Amount of Old Capital Securities being
tendered. See "The Exchange Offer-- Conditions to
the Exchange Offer."
Offer. . . . . . . . . . . . U. S. Bancorp and the Trust reserve the right in
their sole and absolute discretion, subject to
applicable law, at any time and from time to time,
(i) to delay the acceptance of the Old Capital
Securities for exchange, (ii) to terminate the
Exchange Offer if certain specified conditions
have not been satisfied, (iii) to extend the
Expiration Date of the Exchange Offer and retain
all Old Capital Securities tendered pursuant to
the Exchange Offer, subject, however, to the right
of holders of Old Capital Securities to withdraw
their tendered Old Capital Securities, or (iv) to
waive any condition or otherwise amend the terms
of the Exchange Offer in any respect. See "The
Exchange Offer--Terms of the Exchange Offer."
Withdrawal Rights. . . . . . Tenders of Old Capital Securities may be withdrawn
at any time on or prior to the Expiration Date by
delivering a written notice of such withdrawal to
the Exchange Agent (as defined below) in
conformity with certain procedures set forth below
under "The Exchange Offer--Withdrawal Rights."
Procedures for Tendering Old
Capital Securities. . . . . Brokers, dealers, commercial banks, trust
companies and other nominees who hold Old Capital
Securities through The Depository Trust Company
("DTC") may effect tenders by book-entry transfer
in accordance with
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DTC's Automated Tender Offer Program ("ATOP").
Holders of such Old Capital Securities registered
in the name of a broker, dealer, commercial bank,
trust company or other nominee are urged to
contact such person promptly if they wish to
tender Old Capital Securities. In order for Old
Capital Securities to be tendered by a means other
than by book-entry transfer, a Letter of
Transmittal must be completed and signed in
accordance with the instructions contained
therein. The Letter of Transmittal and any other
documents required by the Letter of Transmittal
must be delivered to the Exchange Agent by mail,
facsimile, hand delivery or overnight courier and
either such Old Capital Securities must be
delivered to the Exchange Agent or specified
procedures for guaranteed delivery must be
complied with. See "The Exchange Offer--Procedures
for Tendering Old Capital Securities."
Letters of Transmittal and certificates
representing Old Capital Securities should not be
sent to U. S. Bancorp or the Trust. Such documents
should only be sent to the Exchange Agent.
Resales of New Capital
Securities. . . . . . . . . U. S. Bancorp and the Trust are making the
Exchange Offer in reliance on the position of the
staff of the Division of Corporation Finance of
the Commission as set forth in certain
interpretive letters addressed to third parties in
other transactions. However, neither U. S. Bancorp
nor the Trust has sought its own interpretive
letter and there can be no assurance that the
staff of the Division of Corporation Finance of
the Commission would make a similar determination
with respect to the Exchange Offer as it has in
such interpretive letters to third parties. Based
on these interpretations by the staff of the
Division of Corporation Finance of the Commission,
and subject to the two immediately following
sentences, U. S. Bancorp and the Trust believe
that New Capital Securities issued pursuant to
this Exchange Offer in exchange for Old Capital
Securities may be offered for resale, resold and
otherwise transferred by a holder thereof (other
than a holder who is a broker-dealer) without
further compliance with the registration and
prospectus delivery requirements of the Securities
Act, provided that such New Capital Securities are
acquired in the ordinary course of such holder's
business and that such holder is not
participating, and has no arrangement or
understanding
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with any person to participate, in a distribution
(within the meaning of the Securities Act) of such
New Capital Securities. However, any holder of Old
Capital Securities who is an Affiliate of U. S.
Bancorp or the Trust or who intends to participate
in the Exchange Offer for the purpose of
distributing the New Capital Securities, or any
broker-dealer who purchased the Old Capital
Securities from the Trust for resale pursuant to
Rule 144A or any other available exemption under
the Securities Act, (a) will not be able to rely
on the interpretations of the staff of the
Division of Corporation Finance of the Commission
set forth in the above-mentioned interpretive
letters, (b) will not be permitted or entitled to
tender such Old Capital Securities in the Exchange
Offer and (c) must comply with the registration
and prospectus delivery requirements of the
Securities Act in connection with any sale or
other transfer of such Old Capital Securities
unless such sale is made pursuant to an exemption
from such requirements. In addition, as described
below, if any broker-dealer holds Old Capital
Securities acquired for its own account as a
result of market-making or other trading
activities and exchanges such Old Capital
Securities for New Capital Securities, then such
broker-dealer must deliver a prospectus meeting
the requirements of the Securities Act in
connection with any resales of such New Capital
Securities.
Each holder of Old Capital Securities who wishes
to exchange Old Capital Securities for New Capital
Securities in the Exchange Offer will be required
to represent that (i) it is not an Affiliate of U.
S. Bancorp or the Trust, (ii) any New Capital
Securities to be received by it are being acquired
in the ordinary course of its business, (iii) it
has no arrangement or understanding with any
person to participate in a distribution (within
the meaning of the Securities Act) of such New
Capital Securities, and (iv) if such holder is not
a broker-dealer, such holder is not engaged in,
and does not intend to engage in, a distribution
(within the meaning of the Securities Act) of such
New Capital Securities. Each broker-dealer that
receives New Capital Securities for its own
account pursuant to the Exchange Offer must
acknowledge that it acquired the Old Capital
Securities for its own account as the result of
market-making activities or other trading
activities and must agree that it will deliver a
prospectus meeting the requirements of the
Securities Act in
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connection with any resale of such New Capital
Securities. The Letter of Transmittal states that,
by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to
admit that it is an "underwriter" within the
meaning of the Securities Act. Based on the
position taken by the staff of the Division of
Corporation Finance of the Commission in the
interpretive letters referred to above, U. S.
Bancorp and the Trust believe that Participating
Broker-Dealers who acquired Old Capital Securities
for their own accounts as a result of
market-making activities or other trading
activities may fulfill their prospectus delivery
requirements with respect to the New Capital
Securities received upon exchange of such Old
Capital Securities (other than Old Capital
Securities which represent an unsold allotment
from the original sale of the Old Capital
Securities) with a prospectus meeting the
requirements of the Securities Act, which may be
the prospectus prepared for an exchange offer so
long as it contains a description of the plan of
distribution with respect to the resale of such
New Capital Securities. Accordingly, this
Prospectus, as it may be amended or supplemented
from time to time, may be used by a Participating
Broker-Dealer in connection with resales of New
Capital Securities received in exchange for Old
Capital Securities where such Old Capital
Securities were acquired by such Participating
Broker-Dealer for its own account as a result of
market-making or other trading activities. Subject
to certain provisions set forth in the
Registration Rights Agreement and to the
limitations described below under "The Exchange
Offer--Resales of New Capital Securities," U. S.
Bancorp and the Trust have agreed that this
Prospectus, as it may be amended or supplemented
from time to time, may be used by a Participating
Broker-Dealer in connection with resales of such
New Capital Securities for a period ending 180
days after the Expiration Date (subject to
extension under certain limited circumstances) or,
if earlier, when all such New Capital Securities
have been disposed of by such Participating
Broker-Dealer. See "Plan of Distribution." Any
Participating Broker-Dealer which is an Affiliate
of U. S. Bancorp or the Trust may not rely on such
interpretive letters and must comply with the
registration and prospectus delivery requirements
of the Securities Act in connection with any
resale transaction. See "The Exchange
Offer--Resales of New Capital Securities."
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<PAGE>
Exchange Agent. . . . . . . . The exchange agent with respect to the Exchange
Offer is The First National Bank of Chicago (the
"Exchange Agent"). The address, and telephone and
facsimile numbers, of the Exchange Agent are set
forth in "The Exchange Offer--Exchange Agent" and
in the Letter of Transmittal.
Use of Proceeds. . . . . . . Neither U. S. Bancorp nor the Trust will receive
any cash proceeds from the issuance of the New
Capital Securities offered hereby. See "Use of
Proceeds."
Certain Federal Income
Tax Consequences; ERISA
Considerations. . . . . . . Holders of Old Capital Securities should review
the information set forth under "Certain Federal
Income Tax Consequences" and "Certain ERISA
Considerations" prior to tendering Old Capital
Securities in the Exchange Offer.
THE NEW CAPITAL SECURITIES
Securities Offered. . . . . . Up to $300,000,000 aggregate Liquidation Amount of
the Trust's New Capital Securities which have been
registered under the Securities Act (Liquidation
Amount $1,000 per New Capital Security). The New
Capital Securities will be issued and the Old
Capital Securities were issued under the Trust
Agreement. The New Capital Securities and any Old
Capital Securities which remain outstanding after
consummation of the Exchange Offer will vote
together as a single class for purposes of
determining whether holders of the requisite
percentage in outstanding Liquidation Amount
thereof have taken certain actions or exercised
certain rights under the Trust Agreement. See
"Description of New Securities-- Description of
New Capital Securities-- Voting Rights; Amendment
of the Trust Agreement." The terms of the New
Capital Securities are identical in all material
respects to the terms of the Old Capital
Securities, except that the New Capital Securities
have been registered under the Securities Act,
will not be subject to certain restrictions on
transfer applicable to the Old Capital Securities
and will not provide for any increase in the
Distribution rate thereon in connection with the
Exchange Offer. See "The Exchange Offer--Purpose
of the Exchange Offer," "Description of New
Securities" and "Description of Old Securities."
Distribution Dates. . . . . . June 15 and December 15 of each year, commencing
December 15, 1997.
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Extension Periods. . . . . . Distributions on the New Capital Securities will
be deferred for the duration of any Extension
Period elected by U. S. Bancorp with respect to
the payment of interest on the New Junior
Subordinated Debentures. No Extension Period will
exceed 10 consecutive semi- annual periods or
extend beyond the Stated Maturity of the New
Junior Subordinated Debentures (December 15,
2026). There is no limitation on the number of
times that U. S. Bancorp may elect to begin an
Extension Period. During an Extension Period, U.
S. Bancorp will not be permitted to pay any cash
distributions with respect to its capital stock or
take certain other actions, subject to certain
exceptions. See "Description of New
Securities--Description of New Junior Subordinated
Debentures--Option to Defer Interest Payments" and
"Certain Federal Income Tax Consequences--Interest
Income and Original Issue Discount."
Ranking. . . . . . . . . . . The New Capital Securities will rank pari passu,
and payments thereon will be made pro rata, with
the Old Capital Securities and the Common
Securities except as described under "Description
of New Securities--Description of New Capital
Securities--Subordination of Common Securities."
The New Junior Subordinated Debentures will rank
pari passu with the Old Junior Subordinated
Debentures and will be unsecured and subordinate
and junior in right of payment to the extent and
in the manner set forth in the New Indenture to
all Senior Debt (as defined herein). See
"Description of New Securities--Description of New
Junior Subordinated Debentures--Subordination."
The New Guarantee will rank pari passu with the
Old Guarantee and will constitute an unsecured
obligation of U. S. Bancorp and will rank
subordinate and junior in right of payment to the
extent and in the manner set forth in the
Guarantee Agreement to be entered into between U.
S. Bancorp and The First National Bank of Chicago,
as trustee (the "Guarantee Agreement"). See
"Description of New Securities--Description of New
Guarantee."
Redemption. . . . . . . . . . The Trust Securities are subject to mandatory
redemption (i) at the Stated Maturity upon
repayment of the Junior Subordinated Debentures,
(ii) contemporaneously with the optional
redemption at any time in whole (but not in part)
by U. S. Bancorp of the Junior Subordinated
Debentures upon the occurrence and continuation of
a Tax Event or Capital Treatment Event and (iii)
at any time on or after December 15, 2006,
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contemporaneously with the optional redemption by
U. S. Bancorp in whole at any time or in part from
time to time of the Junior Subordinated
Debentures, in each case at the applicable
Redemption Price. See "Description of New
Securities--Description of New Capital
Securities--Redemption."
Shorten Maturity. . . . . . . Under certain circumstances upon the occurrence of
a Tax Event, U. S. Bancorp has the right to
shorten the maturity of the Junior Subordinated
Debentures to a date not earlier than June 24,
2016, which will result in redemption of the
Capital Securities as of such earlier maturity.
See "Description of New Securities-- Description
of New Capital Securities-- Right to Shorten
Maturity."
Ratings. . . . . . . . . . . The New Capital Securities are expected to be
rated "a2" by Moody's Investors Service, Inc. and
"BBB+" by Standard & Poor's Ratings Services. A
security rating is not a recommendation to buy,
sell or hold securities and may be subject to
revision or withdrawal at any time by the
assigning rating organization.
Transfer Restrictions. . . . The New Capital Securities are issuable, and may
be transferred, only in blocks having a
Liquidation Amount of not less than $100,000 (100
New Capital Securities). Any transfer, sale or
other disposition of New Capital Securities in a
block having a Liquidation Amount of less than
$100,000, or resulting in a holder's holding New
Capital Securities in a block having a Liquidation
Amount of less than $100,000, will be deemed to be
void and of no legal effect whatsoever.
Absence of Market for
the New Capital Securities. The New Capital Securities will be a new issue of
securities for which there currently is no market.
Accordingly, there can be no assurance as to the
development or liquidity of any market for the New
Capital Securities. The Trust and U. S. Bancorp do
not intend to apply for listing of the New Capital
Securities on any securities exchange or for
inclusion in NASDAQ. See "Plan of Distribution."
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RISK FACTORS
Prospective investors should carefully review the information contained
elsewhere in this Prospectus and should particularly consider the following
matters in connection with the Exchange Offer and the New Capital Securities
offered hereby.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR
SUBORDINATED DEBENTURES
The obligations of U. S. Bancorp under the Guarantee issued by U. S.
Bancorp for the benefit of the holders of Capital Securities and under the
Junior Subordinated Debentures are unsecured and rank subordinate and junior in
right of payment to all Senior Debt of U. S. Bancorp. At March 31, 1997, the
aggregate principal amount of outstanding Senior Debt of U. S. Bancorp was
approximately $604 million. Because U. S. Bancorp is a bank holding company, its
rights and the rights of its creditors to participate in any distribution of
assets of any subsidiary upon the latter's liquidation or reorganization or
otherwise (and thus the ability of holders of the Capital Securities to benefit
indirectly from such distribution) is subject to the prior claims of creditors
of that subsidiary (including depositors in the case of bank subsidiaries),
except to the extent that U. S. Bancorp may itself be a creditor with recognized
claims against that subsidiary. At March 31, 1997, the subsidiaries of U. S.
Bancorp had total liabilities (excluding liabilities owed to U. S. Bancorp) of
approximately $29 billion. There are also various legal limitations on the
extent to which certain of U. S. Bancorp's subsidiaries may extend credit, pay
dividends or otherwise supply funds to, or engage in transactions with, U. S.
Bancorp or certain of its other subsidiaries. Accordingly, the Junior
Subordinated Debentures and the Guarantee will be effectively subordinated to
all existing and future liabilities of U. S. Bancorp's subsidiaries, and holders
of Junior Subordinated Debentures and the Guarantee should look only to the
assets of U. S. Bancorp for payments on the Junior Subordinated Debentures and
the Guarantee. See "Certain Regulatory Considerations." None of the Indenture,
the Guarantee, the Trust Agreement or the Expense Agreement places any
limitation on the amount of secured or unsecured debt, including Senior Debt,
that may be incurred by U. S. Bancorp. See "Description of New
Securities--Description of New Guarantee--Status of New Guarantee" and
"--Description of New Junior Subordinated Debentures--Subordination."
The ability of the Trust to pay amounts due on the Capital Securities is
solely dependent upon U. S. Bancorp making payments on the Junior Subordinated
Debentures as and when required.
OPTION TO DEFER INTEREST PAYMENTS; TAX CONSEQUENCES; MARKET PRICE CONSEQUENCES
So long as no event of default under the Indenture has occurred and is
continuing, U. S. Bancorp has the right under the Indenture to defer payments of
interest on the Junior Subordinated Debentures at any time or from time to time
for a period not exceeding 10 consecutive semi-annual periods with respect to
each Extension Period, provided that no Extension Period may extend beyond the
Stated Maturity of the Junior Subordinated Debentures. As a consequence of any
such deferral, semi-annual Distributions on the Capital Securities by the Trust
will also be deferred (and the amount of Distributions to which holders of the
Capital Securities are entitled will accumulate additional Distributions thereon
at the rate of 8.27% per annum, compounded semi-annually from the relevant
payment date for such Distributions) during any such Extension Period.
Prior to the termination of any such Extension Period, U. S. Bancorp may
further defer the payment of interest, provided that no Extension Period may
exceed 10 consecutive semi-annual periods or extend beyond the Stated Maturity
of the Junior Subordinated Debentures. Upon the termination of any Extension
Period and the payment of all interest then accrued and unpaid (together with
interest thereon at the annual rate of 8.27%, compounded semi-annually from the
interest payment date for such interest, to the extent permitted by
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applicable law), U. S. Bancorp may elect to begin a new Extension Period,
subject to the above requirements. There is no limitation on the number of times
that U. S. Bancorp may elect to begin an Extension Period. See "Description of
New Securities--Description of New Capital Securities-- Distributions" and
"--Description of New Junior Subordinated Debentures-- Option to Defer Interest
Payments."
Should an Extension Period occur, a holder of Capital Securities will be
required to accrue income (in the form of original issue discount) in respect of
its pro rata share of the Junior Subordinated Debentures held by the Trust for
United States federal income tax purposes. As a result, a holder of Capital
Securities will be required to include such income in gross income for United
States federal income tax purposes in advance of the receipt of cash
attributable to such income, and will not receive the cash related to such
income from the Trust if the holder disposes of the Capital Securities prior to
the record date for the payment of Distributions. See "Certain Federal Income
Tax Consequences--Interest Income and Original Issue Discount" and "--Sale or
Redemption of Capital Securities."
U. S. Bancorp has no current intention of exercising its right to defer
payments of interest on the Junior Subordinated Debentures. However, should U.
S. Bancorp elect to exercise such right in the future, the market price of the
Capital Securities is likely to be affected adversely. A holder that disposes of
its Capital Securities during an Extension Period, therefore, might not receive
the same return on its investment as a holder that continues to hold its Capital
Securities. In addition, as a result of the existence of U. S. Bancorp's
right to defer interest payments, the market price of the Capital Securities
(which represent preferred undivided beneficial interests in the Trust) may be
more volatile than the market prices of other securities on which original issue
discount accrues that are not subject to such deferrals.
TAX EVENT OR CAPITAL TREATMENT EVENT REDEMPTION
Upon the occurrence and during the continuation of a Tax Event or Capital
Treatment Event, U. S. Bancorp has the right to redeem the Junior Subordinated
Debentures in whole (but not in part) at any time within 90 days following the
occurrence of such Tax Event or Capital Treatment Event and thereby cause a
mandatory redemption of the Capital Securities. The exercise of such right is
subject to U. S. Bancorp having received prior approval of the Federal Reserve
to do so if then required under applicable capital guidelines or policies of the
Federal Reserve.
In addition, if the Tax Event relates to the deductibility of interest
payable by U. S. Bancorp on the Junior Subordinated Debentures, and if the
opinion referred to in the definition of Tax Event states that the risk of
nondeductibility would be avoided if the maturity of the Junior Subordinated
Debentures were shortened, U. S. Bancorp will have the right to shorten the
maturity of the Junior Subordinated Debentures by the amount stated in such
opinion to be the minimum extent required in order to avoid such risk, but in no
event may U. S. Bancorp shorten the maturity to a Stated Maturity earlier than
June 24, 2016. In such event, the Capital Securities would be redeemed as of
such earlier Stated Maturity of the Junior Subordinated Debentures. In addition,
upon the exercise of the right to shorten the maturity of the Junior
Subordinated Debentures, U. S. Bancorp will no longer have the right to redeem
the Junior Subordinated Debentures prior to the new Stated Maturity upon the
occurrence of a Tax Event or to further shorten the maturity of the Junior
Subordinated Debentures.
A "Tax Event" means the receipt by the Trust of an opinion of counsel
experienced in such matters to the effect that, as a result of any amendment to,
or change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or such
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<PAGE>
proposed change, pronouncement or decision is announced on or after December 24,
1996, there is more than an insubstantial risk that (i) the Trust is, or will be
within 90 days of the date of such opinion, subject to United States federal
income tax with respect to income received or accrued on the Junior Subordinated
Debentures, (ii) interest payable by U. S. Bancorp on the Junior Subordinated
Debentures is not, or within 90 days of the date of such opinion, will not be,
deductible by U. S. Bancorp in whole or in part, for United States federal
income tax purposes, or (iii) the Trust is, or will be within 90 days of the
date of the opinion, subject to more than a de minimis amount of other taxes,
duties or other governmental charges.
A "Capital Treatment Event" means the reasonable determination by U. S.
Bancorp that, as a result of any amendment to, or change (including any proposed
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision thereof or therein, or as a result of any official or
administrative pronouncement or action or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which proposed change, pronouncement, action or decision is announced on or
after December 24, 1996, there is more than an insubstantial risk that U. S.
Bancorp will not be entitled to treat an amount equal to the Liquidation Amount
of the Capital Securities as "Tier I Capital" (or the then equivalent thereof)
for purposes of the capital adequacy guidelines of the Federal Reserve, as then
in effect and applicable to U. S. Bancorp. See "Capitalization."
On February 6, 1997, as part of the Clinton Administration's Fiscal 1998
Budget Proposal, the Treasury Department proposed legislation (the "Proposed
Legislation") which would, among other things, generally deny corporate issuers
a deduction for interest in respect of certain debt obligations, such as the New
Junior Subordinated Debentures, issued on or after the date "of first committee
action," if such debt obligations had a maximum term in excess of 15 years and
are not shown as indebtedness on the issuer's applicable consolidated balance
sheet. The Proposed Legislation has not yet been introduced by any member of the
105th Congress. If other legislation is enacted by Congress and if it gives rise
to a Tax Event, U. S. Bancorp, upon approval of the Federal Reserve if then
required under applicable capital guidelines or policies of the Federal Reserve,
would be permitted to cause a redemption of the Capital Securities prior to
December 15, 2006, or to shorten the maturity of the Junior Subordinated
Debentures to a date not earlier than June 24, 2016, which would result in the
redemption of the Capital Securities on such date. See "Description of New
Securities--Description of New Capital Securities--Redemption," "--Description
of New Junior Subordinated Debentures--Redemption" and "Certain Federal Income
Tax Consequences--Proposed Tax Legislation."
EXCHANGE OF CAPITAL SECURITIES FOR JUNIOR SUBORDINATED DEBENTURES
The holder(s) of all of the outstanding Common Securities will have the
right at any time to terminate the Trust and, after satisfaction of liabilities
to creditors of the Trust as required by applicable law and subject to the
Expense Agreement, cause the Junior Subordinated Debentures to be distributed to
the holders of the Capital Securities and the Common Securities in exchange
therefor upon liquidation of the Trust. The exercise of such right is subject to
U. S. Bancorp having received prior approval of the Federal Reserve if then
required under applicable capital guidelines or policies of the Federal Reserve.
See "Description of New Securities--Description of New Capital
Securities--Liquidation Distribution Upon Termination."
Under current United States federal income tax law and interpretations and
assuming, as expected, that the Trust will not be classified as an association
taxable as a corporation, a distribution of the Junior Subordinated Debentures
upon a liquidation of the Trust should not be a taxable event to holders of the
Capital Securities. However, if a Tax Event were to occur which would cause the
Trust to be subject to United States federal income tax with respect to income
received or accrued on the Junior
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<PAGE>
Subordinated Debentures, a distribution of the Junior Subordinated Debentures by
the Trust could be a taxable event to the Trust and the holders of the Capital
Securities. See "Certain Federal Income Tax Consequences-- Distribution of the
Junior Subordinated Debentures to Holders of Capital Securities."
POSSIBLE ADVERSE EFFECT ON MARKET PRICES
There can be no assurance as to the market prices for New Capital
Securities or New Junior Subordinated Debentures that may be distributed in
exchange for New Capital Securities upon liquidation of the Trust. Accordingly,
the New Capital Securities or the New Junior Subordinated Debentures may trade
at a discount from the price that the investor paid to purchase the New Capital
Securities offered hereby. As a result of the existence of U. S. Bancorp's right
to defer interest payments, the market price of the New Capital Securities
(which represent preferred undivided beneficial interests in the Trust) may be
more volatile than the market prices of other securities that are not subject to
such optional deferrals. Because holders of Capital Securities may receive
Junior Subordinated Debentures in liquidation of the Trust and because
Distributions are otherwise limited to payments on the Junior Subordinated
Debentures, prospective purchasers of New Capital Securities are also making an
investment decision with regard to the New Junior Subordinated Debentures and
should carefully review all the information regarding the New Junior
Subordinated Debentures contained herein. See "Description of New
Securities--Description of New Junior Subordinated Debentures."
RIGHTS UNDER THE GUARANTEE
The Old Guarantee guarantees, and the New Guarantee will guarantee, as the
case may be, to the holders of the Capital Securities the following payments, to
the extent not paid by the Trust: (i) any accumulated and unpaid Distributions
required to be paid on the Capital Securities, to the extent that the Trust has
funds on hand available therefor at such time, (ii) the applicable Redemption
Price with respect to any Capital Securities called for redemption, to the
extent that the Trust has funds on hand available therefor at such time, and
(iii) upon a voluntary or involuntary dissolution, winding up or liquidation of
the Trust (unless the Junior Subordinated Debentures are distributed to holders
of the Capital Securities), the lesser of (a) the aggregate of the Liquidation
Amount and all accumulated and unpaid Distributions to the date of payment, to
the extent that the Trust has funds on hand available therefor at such time, and
(b) the amount of assets of the Trust remaining available for distribution to
holders of the Capital Securities after payment of creditors of the Trust as
required by applicable law and subject to the Expense Agreement. The First
National Bank of Chicago will act as Guarantee Trustee and will hold the
Guarantee for the benefit of the holders of the Capital Securities. The First
National Bank of Chicago will also act as Debenture Trustee for the Junior
Subordinated Debentures and as Property Trustee, and First Chicago Delaware Inc.
will act as Delaware Trustee under the Trust Agreement.
The Guarantee is subordinate as described under "--Ranking of Subordinated
Obligations Under the Guarantee and the Junior Subordinated Debentures" above.
The holders of not less than a majority in aggregate Liquidation Amount of
the Capital Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of the Guarantee or to direct the exercise of any trust power conferred
upon the Guarantee Trustee under the Guarantee. Any holder of the Capital
Securities may institute a legal proceeding directly against U. S. Bancorp to
enforce its rights under the Guarantee without first instituting a legal
proceeding against the Trust, the Guarantee Trustee or any other person or
entity. If U. S. Bancorp were to default on its obligation to pay amounts
payable under the Junior Subordinated Debentures, the Trust would not have
sufficient funds for the payment of Distributions or amounts payable
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<PAGE>
on redemption of the Capital Securities or otherwise, and, in such event,
holders of the Capital Securities would not be able to rely upon the Guarantee
for payment of such amounts. Instead, if an event of default under the Indenture
has occurred and is continuing and such event is attributable to the failure of
U. S. Bancorp to pay interest or premium, if any, on or principal of the Junior
Subordinated Debentures on the applicable payment date, then a holder of Capital
Securities may institute a legal proceeding directly against U. S. Bancorp
pursuant to the terms of the Indenture for enforcement of payment to such holder
of the principal of or interest or premium, if any, on such Junior Subordinated
Debentures having a principal amount equal to the aggregate Liquidation Amount
of the Capital Securities of such holder (a "Direct Action"). In connection with
such Direct Action, U. S. Bancorp will have a right of set-off under the
Indenture to the extent of any payment made by U. S. Bancorp to such holder of
Capital Securities in the Direct Action. Except as described herein, holders of
Capital Securities will not be able to exercise directly any other remedy
available to the holders of the Junior Subordinated Debentures or to assert
directly any other rights in respect of the Junior Subordinated Debentures. See
"Description of New Securities--Description of New Junior Subordinated
Debentures--Enforcement of Certain Rights of Holders of Capital Securities" and
"--Debenture Events of Default" and "--Description of New Guarantee." The Trust
Agreement and the New Capital Securities provide that each holder of Capital
Securities by acceptance thereof agrees to the provisions of the Guarantee, the
Expense Agreement and the Indenture.
LIMITED VOTING RIGHTS
Holders of Capital Securities will have limited voting rights relating
generally to the modification of the Capital Securities and the Guarantee and
the exercise of the Trust's rights as holder of Junior Subordinated Debentures.
Holders of Capital Securities will not be entitled to vote to appoint, remove or
replace the Property Trustee, the Delaware Trustee or any Administrative
Trustee, and such voting rights are vested exclusively in the holder(s) of the
Common Securities except, with respect to the Property Trustee and the Delaware
Trustee, upon the occurrence of certain events described herein. The Property
Trustee, the Administrative Trustees, and the holder(s) of all the outstanding
Common Securities, subject to certain conditions, may amend the Trust Agreement
without the consent of holders of Capital Securities to cure any ambiguity or to
make other provisions not inconsistent with existing provisions of the Trust
Agreement or to ensure that the Trust will be classified for United States
federal income tax purposes as a grantor trust unless such action materially and
adversely affects the interests of such holders. See "Description of New
Securities--Description of New Capital Securities--Voting Rights; Amendment of
the Trust Agreement" and "--Removal of Issuer Trustees."
CONSEQUENCES OF A FAILURE TO EXCHANGE OLD CAPITAL SECURITIES
The Old Capital Securities have not been registered under the Securities
Act or any state securities laws and therefore may not be offered, sold or
otherwise transferred except in compliance with the registration requirements of
the Securities Act and any other applicable securities laws, or pursuant to an
exemption therefrom or in a transaction not subject thereto, and in each case in
compliance with certain other conditions and restrictions. Old Capital
Securities which remain outstanding after consummation of the Exchange Offer
will continue to bear a legend reflecting such restrictions on transfer. In
addition, upon consummation of the Exchange Offer, holders of Old Capital
Securities which remain outstanding will not be entitled to any rights to have
such Old Capital Securities registered under the Securities Act or to any
similar rights under the Registration Rights Agreement (subject to certain
limited exceptions). U. S. Bancorp and the Trust do not intend to register under
the Securities Act any Old Capital Securities which remain outstanding after
consummation of the Exchange Offer (subject to such limited exceptions, if
applicable). To the extent that Old Capital Securities are tendered and accepted
in the Exchange Offer, a holder's ability to sell untendered Old Capital
Securities could be adversely affected.
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<PAGE>
The New Capital Securities and any Old Capital Securities which remain
outstanding after consummation of the Exchange Offer will vote together as a
single class for purposes of determining whether holders of the requisite
percentage in outstanding Liquidation Amount thereof have taken certain actions
or exercised certain rights under the Trust Agreement. See "Description of New
Securities--Description of New Capital Securities--Voting Rights; Amendment of
the Trust Agreement."
Upon consummation of the Exchange Offer, holders of Old Capital Securities
will not be entitled to any increase in the Distribution rate thereon or any
further registration rights under the Registration Rights Agreement, except
under limited circumstances. See "Description of Old Securities."
ABSENCE OF PUBLIC MARKET
The Old Capital Securities were issued to, and U. S. Bancorp believes such
securities are currently owned by, a relatively small number of beneficial
owners. The Old Capital Securities have not been registered under the Securities
Act and will be subject to significant restrictions on transferability if they
are not exchanged for the New Capital Securities. Although the New Capital
Securities generally may be resold or otherwise transferred by the holders (who
are not affiliates of U. S. Bancorp or the Trust) without compliance with the
registration requirements under the Securities Act, they will constitute a new
issue of securities with no established trading market. Accordingly, no
assurance can be given that an active public or other market will develop for
the New Capital Securities or the Old Capital Securities or as to the liquidity
of or to the trading market for the New Capital Securities or the Old Capital
Securities. If an active public market does not develop, the market price and
liquidity of the New Capital Securities may be adversely affected.
If a public trading market develops for the New Capital Securities, future
trading prices will depend on many factors, including, among other things,
prevailing interest rates, U. S. Bancorp's financial results and the market for
similar securities. Depending on prevailing interest rates, the market for
similar securities and other factors, including the financial condition of U. S.
Bancorp, the New Capital Securities may trade at a discount.
Notwithstanding the registration of the New Capital Securities in the
Exchange Offer, holders who are Affiliates of U. S. Bancorp or the Trust may
publicly offer for sale or resell the New Capital Securities only in compliance
with the provisions of Rule 144 under the Securities Act.
Each broker-dealer that receives New Capital Securities for its own
account in exchange for Old Capital Securities, where such Old Capital
Securities were acquired by such broker-dealer as a result of market-making
activities or other trading activities, must acknowledge that it will deliver a
prospectus in connection with any resale of such New Capital Securities. See
"Plan of Distribution."
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<PAGE>
U. S. BANCORP CAPITAL I
U. S. Bancorp Capital I (the "Trust") is a statutory business trust
created under Delaware law pursuant to the filing of a certificate of trust with
the Delaware Secretary of State and governed by the Trust Agreement executed by
U. S. Bancorp, as Depositor, The First National Bank of Chicago, as Property
Trustee, First Chicago Delaware Inc., as Delaware Trustee, and the
Administrative Trustees named therein. The Trust's business and affairs are
conducted by its trustees: The First National Bank of Chicago, as Property
Trustee, First Chicago Delaware Inc., as Delaware Trustee, and two individual
Administrative Trustees who are employees or officers of U. S. Bancorp
(collectively, the "Issuer Trustees"). The First National Bank of Chicago, as
Property Trustee, will act as sole indenture trustee under the Trust Agreement.
The First National Bank of Chicago will also act as indenture trustee under the
Guarantee and the Indenture. The Trust exists for the exclusive purposes of (i)
issuing and selling the Capital Securities and Common Securities, (ii) using the
proceeds from the sale of such Trust Securities to acquire Junior Subordinated
Debentures issued by U. S. Bancorp, and (iii) engaging in only those other
activities necessary or incidental thereto (such as registering the transfer of
the Capital Securities). Accordingly, the Junior Subordinated Debentures and the
right to reimbursement under the Expense Agreement will be the sole assets of
the Trust, and payments under the Junior Subordinated Debentures and the Expense
Agreement will be the sole source of revenues of the Trust. All of the Common
Securities will be owned by U. S. Bancorp. The Common Securities will rank pari
passu, and payments will be made thereon pro rata, with the Capital Securities,
except that upon the occurrence and continuance of an event of default under the
Trust Agreement resulting from an event of default under the Indenture, the
rights of U. S. Bancorp as holder of the Common Securities to payment in respect
of Distributions and payments upon liquidation, redemption or otherwise will be
subordinated to the rights of the holders of the Capital Securities. See
"Description of New Securities--Description of New Capital
Securities--Subordination of Common Securities." U. S. Bancorp has acquired
Common Securities in an aggregate Liquidation Amount equal to more than 3% of
the total capital of the Trust. The Trust has a term of 55 years, but may
terminate earlier as provided in the Trust Agreement. The principal executive
office of the Trust is c/o U. S. Bancorp, 111 S.W. Fifth Avenue, Portland,
Oregon 97204, Attention: Corporate Secretary Division, and its telephone number
is (503) 275-6111.
It is anticipated that the Trust will not be subject to the reporting
requirements under the Exchange Act.
U. S. BANCORP
U. S. Bancorp is a regional multi-bank holding company headquartered in
Portland, Oregon. At December 31, 1996, U. S. Bancorp was the 26th largest bank
holding company in the United States in terms of total assets, with total
consolidated assets of $33.3 billion, deposits of $25.0 billion, and total
shareholders' equity of $2.7 billion.
U. S. Bancorp is engaged in a general retail and commercial banking
business in the states of Oregon, Washington, Idaho, California, Nevada, and
Utah through its banking subsidiaries. Other subsidiaries of U. S. Bancorp
provide financial services related to banking including lease financing,
consumer and commercial finance, discount brokerage, investment advisory
services, and insurance agency and credit life insurance services. The principal
executive offices of U. S. Bancorp are located at 111 S.W. Fifth Avenue,
Portland, Oregon 97204, telephone number (503) 275-6111.
On March 20, 1997, U. S. Bancorp and First Bank System Inc. ("FBS")
announced the signing of a definitive agreement for FBS to acquire U. S. Bancorp
for stock valued at approximately $9 billion. The resulting company, which will
be called U. S. Bancorp and will be headquartered in Minneapolis, Minnesota,
will create the 14th largest banking organization in the United States based on
combined assets of approximately $70 billion. The
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<PAGE>
combined company will serve nearly 4 million households and 475,000 businesses
in 17 contiguous states. The merger is subject to regulatory and shareholder
approvals and is expected to close in the third quarter of 1997. Pro forma
financial statements reflecting the pending merger are incorporated herein by
reference to U. S. Bancorp's Current Report on Form 8-K dated June 17, 1997. See
"Incorporation of Certain Documents by Reference."
CERTAIN REGULATORY CONSIDERATIONS
GENERAL
U. S. Bancorp is a legal entity, separate and distinct from its bank
subsidiaries. The principal sources of U. S. Bancorp's revenues are dividends
and fees from its subsidiaries. There are various legal limitations on the
extent to which U. S. Bancorp's bank subsidiaries may extend credit, pay
dividends, or otherwise supply funds to U. S. Bancorp or U. S. Bancorp's other
affiliates. In particular, U. S. Bancorp's bank subsidiaries are subject to
certain restrictions imposed by federal law on extensions of credit to U. S.
Bancorp or its affiliates, on investments in stock or other securities thereof
and on the taking of such securities as collateral for loans. Such restrictions
prohibit U. S. Bancorp or such other affiliates from borrowing from U. S.
Bancorp's bank subsidiaries unless the loans are secured by specified
collateral. Further, such secured loans and investments by a U. S. Bancorp bank
subsidiary are limited in amount as to U. S. Bancorp or to any other such
affiliate to 10% of the bank subsidiary's capital stock and surplus and as to U.
S. Bancorp and all such affiliates to an aggregate of 20% of the bank
subsidiary's capital stock and surplus.
In addition, there are certain limitations on the payment of dividends to
U. S. Bancorp by its bank subsidiaries. A national bank may not pay dividends in
an amount greater than its net profits then on hand after deducting statutory
bad debt in excess of the bank's allowance for loan losses. The prior approval
of the United States Comptroller of the Currency (the "Comptroller") is required
if the total of all dividends declared by a national bank subsidiary in any
calendar year will exceed the total of such subsidiary's net profits (as defined
by regulation) for that year combined with its retained net profits for the
preceding two calendar years, less any required transfers to surplus or to a
fund for the retirement of any preferred stock. As of December 31, 1996, U. S.
Bancorp's banking subsidiaries could have declared dividends without approval of
the Comptroller of up to an aggregate of $56 million. The payment of dividends
by U. S. Bancorp's national bank subsidiaries may be affected by other factors,
such as requirements for the maintenance of adequate capital. The Comptroller
also has the authority to prohibit a national bank from engaging in what, in the
Comptroller's opinion, constitutes an unsafe or unsound practice in conducting
its business. The payment of a dividend by a bank could, depending upon the
financial condition of such bank and other factors, be construed by the
Comptroller to be such an unsafe or unsound practice. The Comptroller has stated
that a dividend by a national bank should bear a direct correlation to the level
of the bank's current and expected earnings stream, the bank's need to maintain
an adequate capital base and the marketplace's perception of the bank and should
not be governed by the financing needs of the bank's parent corporation. In
addition, the Comptroller has issued a policy statement which provides that
national banks should generally pay dividends only out of current operating
earnings. U. S. Bancorp's nonbank subsidiaries are also subject to limitations
on the payment of dividends. Also, under the Federal Deposit Insurance
Corporation Improvement Act of 1991, an FDIC-insured depository institution
cannot make a capital distribution (including a payment of dividends) or pay any
management fees to its holding company or pay any dividend if it is
undercapitalized or if such payment would cause it to become undercapitalized.
If the ability of its bank subsidiaries to pay dividends to U. S. Bancorp were
to become restricted, U. S. Bancorp would need to rely on alternative means of
raising funds to satisfy its cash requirements, which might include, but would
not be restricted to, nonbank subsidiary dividends, asset sales or other capital
market transactions.
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<PAGE>
In the event that a depository institution subsidiary becomes
undercapitalized (as that term is defined by the federal bank regulatory
agencies), U. S. Bancorp may be required to guarantee compliance by the
subsidiary with a capital restoration plan. U. S. Bancorp's aggregate liability
under any such guarantee may not exceed the lesser of 5% of the subsidiary's
total assets when it became undercapitalized or the amount of the capital
deficiency at such time as it fails to comply with the plan.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth U. S. Bancorp's ratio of earnings to fixed
charges and ratio of earnings to combined fixed charges and preferred stock
dividend requirements for each of the periods indicated.
<TABLE>
<CAPTION>
U. S. BANCORP AND SUBSIDIARIES(a)
Three Months Ended March 31, Year Ended December 31,
1997 1996 1996 1995 1994 1993 1992
Ratio of earnings to fixed charges:
<S> <C> <C> <C> <C> <C> <C> <C>
Excluding interest on deposits 3.63x 3.74x 3.86x 2.72x 2.58x 3.74x 2.77x
Including interest on deposits 1.71x 1.69x 1.72x 1.51x 1.48x 1.71x 1.47x
Ratio of earnings to combined
fixed charges and preferred
stock dividends:
Excluding interest on deposits 3.47x 3.55x 3.66x 2.61x 2.47x 3.49x 2.70x
Including interest on deposits 1.70x 1.68x 1.71x 1.50x 1.47x 1.69x 1.47x
</TABLE>
(a) For purposes of computing these ratios, earnings represent consolidated
income before income taxes and accounting changes plus consolidated fixed
charges, less capitalized interest. Fixed charges represent interest, whether
expensed or capitalized, including interest on deposits where indicated, imputed
interest on capital leases and approximately one-third of all other rent expense
(such amount approximating the interest component of such expense), but
excluding interest income on federal funds sold, which approximates interest
expense related to federal funds purchased transactions having a purpose other
than to fund operations. Preferred stock dividend requirements represent the
amount required to cover preferred stock dividends.
USE OF PROCEEDS
Neither U. S. Bancorp nor the Trust will receive any cash proceeds from
the issuance of the New Capital Securities offered hereby. In consideration for
issuing the New Capital Securities in exchange for Old Capital Securities as
described in this Prospectus, the Trust will receive Old Capital Securities in
like Liquidation Amount. The Old Capital Securities surrendered in exchange for
the New Capital Securities will be retired and canceled.
The proceeds to the Trust (without giving effect to expenses of the
offering payable by U. S. Bancorp) from the offering of the Old Capital
Securities was $300,000,000. All of the proceeds from the sale of Old Capital
Securities was invested by the Trust in the Junior Subordinated Debentures. U.
S. Bancorp intends that the net proceeds from the sale of the Old Junior
Subordinated Debentures will be used for general corporate purposes, including
the potential redemption of U. S. Bancorp's 8-1/8% Cumulative Preferred Stock,
Series A (which first becomes redeemable on July 23, 1997) and investments in,
or extensions of credit to, U. S. Bancorp's subsidiaries. The precise amount and
timing of the application of such net proceeds used for such corporate purposes
will depend on the funding requirements and the availability of other funds to
U. S. Bancorp and its subsidiaries. Pending such application by U. S. Bancorp,
such net proceeds have been temporarily invested in short-term interest-bearing
securities.
The Capital Securities will be eligible to qualify as Tier I capital under
the capital guidelines of the Federal Reserve.
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<PAGE>
CAPITALIZATION
The following table sets forth the consolidated capitalization of U. S.
Bancorp and its subsidiaries as of March 31, 1997, which reflects the issuance
of the Old Securities. The issuance of the New Securities in the Exchange Offer
will have no effect on the capitalization of U. S. Bancorp.
CAPITALIZATION TABLE
MARCH 31, 1997
(DOLLAR AMOUNTS IN MILLIONS)
Long-term debt:
U. S. Bancorp (parent company only):
Medium-term notes due 1997-2001 $ 244.8
Floating rate notes due 1999 200.0
8.125% subordinated notes due 2002 149.5
7.00% subordinated notes due 2003 149.8
6.75% subordinated notes due 2005 297.0
7.50% subordinated debentures due 2026 198.6
Bank Subsidiaries:
Bank notes due 1997 13.8
FHLB notes due 1997-2025 446.7
Floating rate notes due 2000 250.0
-------
Total long-term debt 1,950.2
-------
Company-obligated mandatory redeemable
capital securities of subsidiary trust (a) 300.0
Shareholders' equity:
Preferred stock, no par value,
Authorized--50,000,000 shares;
Issued--6,000,000 shares 150.0
Common stock, $5 par value,
Authorized--250,000,000 shares;
Issued--148,175,994 shares 740.9
Capital surplus 199.5
Retained earnings 1,715.0
Net unrealized loss on securities available
for sale, net of tax (23.3)
-------
Total shareholders' equity 2,782.1
-------
Total capitalization $5,032.3
=======
(a) As described herein, the sole assets of the Trust will be the Junior
Subordinated Debentures issued by U. S. Bancorp to the Trust and the right to
reimbursement under the Expense Agreement. The Junior Subordinated Debentures
will mature on December 15, 2026. U. S. Bancorp owns all of the Common
Securities of the Trust.
THE EXCHANGE OFFER
PURPOSE OF THE EXCHANGE OFFER
In connection with the sale of the Old Capital Securities, U. S. Bancorp
and the Trust entered into the Registration Rights Agreement with the Initial
Purchasers, pursuant to which U. S. Bancorp and the Trust agreed to file and to
use their reasonable best efforts to cause to become effective with the
Commission a registration statement with respect to the exchange of the Old
Capital Securities for the New Capital Securities. A copy of the Registration
Rights Agreement has been filed as an exhibit to the Registration Statement of
which this Prospectus is a part.
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The Exchange Offer is being made to satisfy the contractual obligations of
U. S. Bancorp and the Trust under the Registration Rights Agreement. The form
and terms of the New Capital Securities are the same as the form and terms of
the Old Capital Securities except that the New Capital Securities have been
registered under the Securities Act, will not be subject to certain restrictions
on transfer applicable to the Old Capital Securities, and will not provide for
an increase in the Distribution rate in the event that a registration statement
relating to the Exchange Offer is not filed or declared effective by specified
dates. Upon consummation of the Exchange Offer, holders of Old Capital
Securities will not be entitled to any increase in the Distribution rate thereon
or any further registration rights under the Registration Rights Agreement,
except under limited circumstances. See "Risk Factors--Consequences of a Failure
to Exchange Old Capital Securities" and "Description of Old Securities."
The Exchange Offer is not being made to, nor will the Trust accept tenders
for exchange from, holders of Old Capital Securities in any jurisdiction in
which the Exchange Offer or the acceptance thereof would not be in compliance
with the securities or blue sky laws of such jurisdiction.
Unless the context requires otherwise, the term "holder" with respect to
the Exchange Offer means any person in whose name the Old Capital Securities are
registered on the books of the Trust or any other person who has obtained a
properly completed bond power from the registered holder, or any person whose
Old Capital Securities are held of record by The Depository Trust Company
("DTC") who desires to deliver such Old Capital Securities by book-entry
transfer at DTC.
Pursuant to the Exchange Offer, promptly after the Expiration Date, U. S.
Bancorp will exchange the Old Guarantee for the New Guarantee and the Old Junior
Subordinated Debentures, in an amount corresponding to the Old Capital
Securities accepted for exchange, for a like aggregate principal amount of the
New Junior Subordinated Debentures. The New Guarantee and New Junior
Subordinated Debentures have been registered under the Securities Act.
TERMS OF THE EXCHANGE OFFER
The Trust hereby offers, upon the terms and subject to the conditions set
forth in this Prospectus and in the accompanying Letter of Transmittal, to
exchange up to $300,000,000 aggregate Liquidation Amount of New Capital
Securities for a like aggregate Liquidation Amount of Old Capital Securities
properly tendered on or prior to the Expiration Date and not properly withdrawn
in accordance with the procedures described below. The Trust will issue,
promptly after the Expiration Date, an aggregate Liquidation Amount of up to
$300,000,000 of New Capital Securities in exchange for a like principal amount
of outstanding Old Capital Securities tendered and accepted in connection with
the Exchange Offer. Holders may tender their Old Capital Securities in whole or
in part in a Liquidation Amount of $100,000 (100 Capital Securities) or any
integral multiple of $1,000 (one Capital Security) in excess thereof; provided
that, if any Old Capital Securities are tendered for exchange in part, the
untendered Liquidation Amount thereof must be $100,000 (100 Capital Securities)
or any integral multiple of $1,000 (one Capital Security) in excess thereof.
The Exchange Offer is not conditioned upon any minimum Liquidation Amount
of Old Capital Securities being tendered. As of the date of this Prospectus,
$300,000,000 aggregate Liquidation Amount of the Old Capital Securities is
outstanding.
Holders of Old Capital Securities do not have any appraisal or dissenters'
rights in connection with the Exchange Offer. Old Capital Securities which are
not tendered for or are tendered but not accepted in connection with the
Exchange Offer will remain outstanding and be entitled to the benefits of the
Trust Agreement, but will not be entitled to any further registration rights
under the Registration Rights Agreement, except under
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limited circumstances. See "Risk Factors--Consequences of a Failure to Exchange
Old Capital Securities" and "Description of Old Securities."
If any tendered Old Capital Securities are not accepted for exchange
because of an invalid tender, the occurrence of certain other events set forth
herein or otherwise, certificates for any such unaccepted Old Capital Securities
will be returned, without expense, to the tendering holder thereof promptly
after the Expiration Date.
Holders who tender Old Capital Securities in connection with the Exchange
Offer will not be required to pay brokerage commissions or fees or, subject to
the instructions in the Letter of Transmittal, transfer taxes with respect to
the exchange of Old Capital Securities in connection with the Exchange Offer. U.
S. Bancorp will pay all charges and expenses, other than certain applicable
taxes described below, in connection with the Exchange Offer. See "--Fees and
Expenses."
NEITHER U. S. BANCORP, THE BOARD OF DIRECTORS OF U. S. BANCORP NOR ANY
ISSUER TRUSTEE OF THE TRUST MAKES ANY RECOMMENDATION TO HOLDERS OF OLD CAPITAL
SECURITIES AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING ALL OR ANY PORTION
OF THEIR OLD CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER. IN ADDITION, NO
ONE HAS BEEN AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION. HOLDERS OF OLD CAPITAL
SECURITIES MUST MAKE THEIR OWN DECISION WHETHER TO TENDER PURSUANT TO THE
EXCHANGE OFFER AND, IF SO, THE AGGREGATE AMOUNT OF OLD CAPITAL SECURITIES TO
TENDER BASED ON SUCH HOLDERS' OWN FINANCIAL POSITION AND REQUIREMENTS.
The term "Expiration Date" means 5:00 p.m., New York City time, on July
__, 1997 unless the Exchange Offer is extended by U. S. Bancorp or the Trust (in
which case the term "Expiration Date" shall mean the latest date and time to
which the Exchange Offer is extended).
U. S. Bancorp and the Trust expressly reserve the right in their sole and
absolute discretion, subject to applicable law, at any time and from time to
time, (i) to delay the acceptance of the Old Capital Securities for exchange,
(ii) to terminate the Exchange Offer (whether or not any Old Capital Securities
have theretofore been accepted for exchange) if the Trust determines, in its
sole and absolute discretion, that any of the events or conditions referred to
under "--Conditions to the Exchange Offer" have occurred or exist or have not
been satisfied, (iii) to extend the Expiration Date of the Exchange Offer and
retain all Old Capital Securities tendered pursuant to the Exchange Offer,
subject, however, to the right of holders of Old Capital Securities to withdraw
their tendered Old Capital Securities as described under "--Withdrawal Rights,"
and (iv) to waive any condition or otherwise amend the terms of the Exchange
Offer in any respect. If the Exchange Offer is amended in a manner determined by
U. S. Bancorp and the Trust to constitute a material change, or if U. S. Bancorp
and the Trust waive a material condition of the Exchange Offer, U. S. Bancorp
and the Trust will promptly disclose such amendment by means of a prospectus
supplement that will be distributed to the holders of the Old Capital
Securities, and U. S. Bancorp and the Trust will extend the Exchange Offer to
the extent required by Rule 14e-1 under the Exchange Act.
Any such delay in acceptance, extension, termination or amendment will be
followed promptly by oral or written notice thereof to the Exchange Agent and by
making a public announcement thereof, and such announcement in the case of an
extension will be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date. Without limiting
the manner in which U. S. Bancorp and the Trust may choose to make any public
announcement and subject to applicable law, U. S. Bancorp and the Trust shall
have no obligation to publish, advertise or otherwise communicate any such
public announcement other than by issuing a release to an appropriate news
agency.
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ACCEPTANCE FOR EXCHANGE AND ISSUANCE OF NEW CAPITAL SECURITIES
Upon the terms and subject to the conditions of the Exchange Offer, the
Trust will exchange, and will issue to the Exchange Agent, New Capital
Securities for Old Capital Securities validly tendered and not withdrawn
promptly after the Expiration Date.
In all cases, delivery of New Capital Securities in exchange for Old
Capital Securities tendered and accepted for exchange pursuant to the Exchange
Offer will be made only after timely receipt by the Exchange Agent of (i) Old
Capital Securities or a book-entry confirmation of a book-entry transfer of Old
Capital Securities into the Exchange Agent's account at DTC, (ii) the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, with
any required signature guarantees or, in the case of a book-entry transfer, an
Agent's Message in lieu of the Letter of Transmittal, and (iii) any other
documents required by the Letter of Transmittal.
The term "book-entry confirmation" means a timely confirmation of a
book-entry transfer of Old Capital Securities into the Exchange Agent's account
at DTC. See "--Procedures for Tendering Old Capital Securities--Book-Entry
Transfer." The term "Agent's Message" means a message, transmitted by DTC to and
received by the Exchange Agent and forming a part of a book-entry confirmation,
which states that DTC has received an express acknowledgment from the tendering
participant, which acknowledgment states that such participant has received and
agrees to be bound by the Letter of Transmittal and that the Trust and U. S.
Bancorp may enforce such Letter of Transmittal against such participant.
The New Capital Securities will be issued in minimum blocks of at least
100 (representing a minimum of $100,000 aggregate Liquidation Amount) and the
New Capital Securities must at all times be held in blocks of at least 100. Any
transfer, sale or other disposition of New Capital Securities in a block having
a Liquidation Amount of less than $100,000, or resulting in a holder's holding
New Capital Securities in a block having a Liquidation Amount of less than
$100,000, will be deemed to be void and of no legal effect whatsoever.
Subject to the terms and conditions of the Exchange Offer, the Trust will
be deemed to have accepted for exchange, and thereby exchanged, Old Capital
Securities validly tendered and not withdrawn as, if and when the Trust gives
oral or written notice to the Exchange Agent of the Trust's acceptance of such
Old Capital Securities for exchange pursuant to the Exchange Offer. The Exchange
Agent will act as agent for the Trust for the purpose of receiving tenders of
Old Capital Securities, Letters of Transmittal and related documents, and as
agent for tendering holders for the purpose of receiving Old Capital Securities,
Letters of Transmittal and related documents and transmitting New Capital
Securities to validly tendering holders. Such exchange will be made promptly
after the Expiration Date. If for any reason whatsoever, acceptance for exchange
or the exchange of any Old Capital Securities tendered pursuant to the Exchange
Offer is delayed (whether before or after the Trust's acceptance for exchange of
Old Capital Securities) or the Trust extends the Exchange Offer or is unable to
accept for exchange or exchange Old Capital Securities tendered pursuant to the
Exchange Offer, then, without prejudice to the Trust's rights set forth herein,
the Exchange Agent may, nevertheless, on behalf of the Trust and subject to Rule
14e-1(c) under the Exchange Act, retain tendered Old Capital Securities and such
Old Capital Securities may not be withdrawn except to the extent tendering
holders are entitled to withdrawal rights as described under "--Withdrawal
Rights."
Pursuant to an Agent's Message or the Letter of Transmittal, a holder of
Old Capital Securities will warrant and agree in the Letter of Transmittal that
it has full power and authority to tender, exchange, sell, assign and transfer
Old Capital Securities, that the Trust will acquire good, marketable and
unencumbered title to the tendered Old Capital Securities, free and clear of all
liens, restrictions, charges and encumbrances, and the Old Capital Securities
tendered for exchange are not subject to any adverse claims or proxies. The
holder also will warrant and agree that it will, upon request,
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execute and deliver any additional documents deemed by the Trust or the Exchange
Agent to be necessary or desirable to complete the exchange, sale, assignment,
and transfer of the Old Capital Securities tendered pursuant to the Exchange
Offer.
PROCEDURES FOR TENDERING OLD CAPITAL SECURITIES
VALID TENDER. Except as set forth below, in order for Old Capital
Securities to be validly tendered pursuant to the Exchange Offer, a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), with
any required signature guarantees and any other required documents, must be
received by the Exchange Agent at its address set forth under "--Exchange
Agent," and either (i) tendered Old Capital Securities must be received by the
Exchange Agent, or (ii) such Old Capital Securities must be tendered pursuant to
the procedures for book-entry transfer set forth below and a book-entry
confirmation must be received by the Exchange Agent, in each case on or prior to
the Expiration Date, or (iii) the guaranteed delivery procedures set forth below
must be complied with.
If less than all of the Old Capital Securities are tendered, a tendering
holder should fill in the amount of Old Capital Securities being tendered in the
appropriate box on the Letter of Transmittal. The entire amount of Old Capital
Securities delivered to the Exchange Agent will be deemed to have been tendered
unless otherwise indicated.
THE METHOD OF DELIVERY OF CERTIFICATES, THE LETTER OF TRANSMITTAL AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING HOLDER,
AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE
AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL, RETURN RECEIPT REQUESTED,
PROPERLY INSURED, OR AN OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN ALL CASES,
SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
BOOK-ENTRY TRANSFER. The Exchange Agent will establish an account with
respect to the Old Capital Securities at DTC for purposes of the Exchange Offer
within two business days after the date of this Prospectus. Any financial
institution that is a participant in DTC's book-entry transfer facility system
may make a book-entry delivery of the Old Capital Securities by causing DTC to
transfer such Old Capital Securities into the Exchange Agent's account at DTC in
accordance with DTC's procedures for transfers. However, although delivery of
Old Capital Securities may be effected through book-entry transfer into the
Exchange Agent's account at DTC, an Agent's Message or Letter of Transmittal (or
facsimile thereof), properly completed and duly executed, with any required
signature guarantees and any other required documents, must in any case be
delivered to and received by the Exchange Agent at its address set forth under
"--Exchange Agent" on or prior to the Expiration Date, or the guaranteed
delivery procedure set forth below must be complied with.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC'S PROCEDURES DOES NOT
CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
SIGNATURE GUARANTEES. Certificates for the Old Capital Securities need not
be endorsed and signature guarantees on the Letter of Transmittal are
unnecessary unless (a) a certificate for the Old Capital Securities is
registered in a name other than that of the person surrendering the certificate
or (b) such holder completes the box entitled "Special Issuance Instructions" or
"Special Delivery Instructions" in the Letter of Transmittal. In the case of (a)
or (b) above, such certificates for Old Capital Securities must be duly endorsed
or accompanied by a properly executed bond power, with the endorsement or
signature on the bond power and on the Letter of Transmittal guaranteed by a
firm or other entity identified in Rule 17Ad-15 under the Exchange Act as an
"eligible guarantor institution," including (as such terms are defined therein):
(i) a bank; (ii) a broker, dealer, municipal securities broker or dealer or
government securities broker or dealer; (iii) a credit union; (iv) a national
securities exchange, registered securities association or clearing agency; or
(v) a savings association that is a
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participant in a Securities Transfer Association (an "Eligible Institution"),
unless surrendered on behalf of such Eligible Institution. See Instruction 1 to
the Letter of Transmittal.
GUARANTEED DELIVERY. If a holder desires to tender Old Capital Securities
pursuant to the Exchange Offer and the certificates for such Old Capital
Securities are not immediately available or time will not permit all required
documents to reach the Exchange Agent on or prior to the Expiration Date, or the
procedure for book-entry transfer cannot be completed on a timely basis, such
Old Capital Securities may nevertheless be tendered, provided that all of the
following guaranteed delivery procedures are complied with:
(a) such tenders are made by or through an Eligible Institution;
(b) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form accompanying the Letter of Transmittal, is received by
the Exchange Agent, as provided below, on or prior to the Expiration Date; and
(c) the certificates (or a book-entry confirmation) representing all
tendered Old Capital Securities, in proper form for transfer, together with a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), with any required signature guarantees and any other documents
required by the Letter of Transmittal, are received by the Exchange Agent within
three New York Stock Exchange trading days after the date of execution of such
Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand, or transmitted
by facsimile or mail to the Exchange Agent and must include a guarantee by an
Eligible Institution in the form set forth in such notice.
Notwithstanding any other provision hereof, the delivery of New Capital
Securities in exchange for Old Capital Securities tendered and accepted for
exchange pursuant to the Exchange Offer will in all cases be made only after
timely receipt by the Exchange Agent of Old Capital Securities, or of a
book-entry confirmation with respect to such Old Capital Securities, and a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), together with any required signature guarantees and any other
documents required by the Letter of Transmittal. Accordingly, the delivery of
New Capital Securities might not be made to all tendering holders at the same
time, and will depend upon when Old Capital Securities, book-entry confirmations
with respect to Old Capital Securities and other required documents are received
by the Exchange Agent.
The Trust's acceptance for exchange of Old Capital Securities tendered
pursuant to any of the procedures described above will constitute a binding
agreement between the tendering holder and the Trust upon the terms and subject
to the conditions of the Exchange Offer.
DETERMINATION OF VALIDITY. All questions as to the form of documents,
validity, eligibility (including time of receipt) and acceptance for exchange of
any tendered Old Capital Securities will be determined by U. S. Bancorp and the
Trust, in their sole discretion, whose determination shall be final and binding
on all parties. U. S. Bancorp and the Trust reserve the absolute right, in their
sole and absolute discretion, to reject any and all tenders determined by them
not to be in proper form or the acceptance of which, or exchange for, may, in
the opinion of counsel to U. S. Bancorp and the Trust, be unlawful. U. S.
Bancorp and the Trust also reserve the absolute right, subject to applicable
law, to waive any of the conditions of the Exchange Offer as set forth under
"--Conditions to the Exchange Offer" or any condition or irregularity in any
tender of Old Capital Securities of any particular holder whether or not similar
conditions or irregularities are waived in the case of other holders.
The interpretation by U. S. Bancorp and the Trust of the terms and
conditions of the Exchange Offer (including the Letter of Transmittal and the
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instructions thereto) will be final and binding. No tender of Old Capital
Securities will be deemed to have been validly made until all irregularities
with respect to such tender have been cured or waived. Neither U. S. Bancorp,
the Trust, any affiliates or assigns of U. S. Bancorp or the Trust, the Exchange
Agent nor any other person shall be under any duty to give any notification of
any irregularities in tenders or incur any liability for failure to give any
such notification.
If any Letter of Transmittal, endorsement, bond power, power of attorney,
or any other document required by the Letter of Transmittal is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and unless waived by U. S. Bancorp
and the Trust, proper evidence satisfactory to U. S. Bancorp and the Trust, in
their sole discretion, of such person's authority to so act must be submitted.
A beneficial owner of Old Capital Securities that are held by or
registered in the name of a broker, dealer, commercial bank, trust company or
other nominee or custodian is urged to contact such entity promptly if such
beneficial owner wishes to participate in the Exchange Offer.
RESALES OF NEW CAPITAL SECURITIES
The Trust is making the Exchange Offer for the New Capital Securities in
reliance on the position of the staff of the Division of Corporation Finance of
the Commission as set forth in certain interpretive letters addressed to third
parties in other transactions. However, neither U. S. Bancorp nor the Trust
sought its own interpretive letter and there can be no assurance that the staff
of the Division of Corporation Finance of the Commission would make a similar
determination with respect to the Exchange Offer as it has in such interpretive
letters to third parties. Based on these interpretations by the staff of the
Division of Corporation Finance of the Commission, and subject to the two
immediately following sentences, U. S. Bancorp and the Trust believe that New
Capital Securities issued pursuant to this Exchange Offer in exchange for Old
Capital Securities may be offered for resale, resold and otherwise transferred
by a holder thereof (other than a holder who is a broker-dealer) without further
compliance with the registration and prospectus delivery requirements of the
Securities Act, provided that such New Capital Securities are acquired in the
ordinary course of such holder's business and that such holder is not
participating, and has no arrangement or understanding with any person to
participate, in a distribution (within the meaning of the Securities Act) of
such New Capital Securities. However, any holder of Old Capital Securities who
is an Affiliate of U. S. Bancorp or the Trust or who intends to participate in
the Exchange Offer for the purpose of distributing New Capital Securities, or
any broker-dealer who purchased Old Capital Securities from the Trust for resale
pursuant to Rule 144A or any other available exemption under the Securities Act,
(a) will not be able to rely on the interpretations of the staff of the Division
of Corporation Finance of the Commission set forth in the above-mentioned
interpretive letters, (b) will not be permitted or entitled to tender such Old
Capital Securities in the Exchange Offer and (c) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any sale or other transfer of such Old Capital Securities unless
such sale is made pursuant to an exemption from such requirements. In addition,
as described below, if any broker-dealer holds Old Capital Securities acquired
for its own account as a result of market-making or other trading activities and
exchanges such Old Capital Securities for New Capital Securities, then such
broker-dealer must deliver a prospectus meeting the requirements of the
Securities Act in connection with any resales of such New Capital Securities.
Each holder of Old Capital Securities who wishes to exchange Old Capital
Securities for New Capital Securities in the Exchange Offer will be required to
represent that (i) it is not an Affiliate of U. S. Bancorp or the Trust, (ii)
any New Capital Securities to be received by it are being acquired in the
ordinary course of its business, (iii) it has no arrangement or
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understanding with any person to participate in a distribution (within the
meaning of the Securities Act) of such New Capital Securities, and (iv) if such
holder is not a broker-dealer, such holder is not engaged in, and does not
intend to engage in, a distribution (within the meaning of the Securities Act)
of such New Capital Securities. In addition, U. S. Bancorp and the Trust may
require such holder, as a condition to such holder's eligibility to participate
in the Exchange Offer, to furnish to U. S. Bancorp and the Trust (or an agent
thereof) in writing information as to the number of "beneficial owners" (within
the meaning of Rule 13d-3 under the Exchange Act) on behalf of whom such holder
holds the Capital Securities to be exchanged in the Exchange Offer. Each
broker-dealer that receives New Capital Securities for its own account pursuant
to the Exchange Offer must acknowledge that it acquired the Old Capital
Securities for its own account as the result of market-making activities or
other trading activities and must agree that it will deliver a prospectus
meeting the requirements of the Securities Act in connection with any resale of
such New Capital Securities. The Letter of Transmittal states that, by so
acknowledging and by delivering a prospectus, a broker-dealer will not be deemed
to admit that it is an "underwriter" within the meaning of the Securities Act.
Based on the position taken by the staff of the Division of Corporation Finance
of the Commission in the interpretive letters referred to above, U. S. Bancorp
and the Trust believe that Participating Broker-Dealers who acquired Old Capital
Securities for their own accounts as a result of market-making activities or
other trading activities may fulfill their prospectus delivery requirements with
respect to the New Capital Securities received upon exchange of such Old Capital
Securities (other than Old Capital Securities which represent an unsold
allotment from the original sale of the Old Capital Securities) with a
prospectus meeting the requirements of the Securities Act, which may be the
prospectus prepared for an exchange offer so long as it contains a description
of the plan of distribution with respect to the resale of such New Capital
Securities. Accordingly, this Prospectus, as it may be amended or supplemented
from time to time, may be used by a Participating Broker-Dealer during the
period referred to below in connection with resales of New Capital Securities
received in exchange for Old Capital Securities where such Old Capital
Securities were acquired by such Participating Broker-Dealer for its own account
as a result of market-making or other trading activities. Subject to certain
provisions set forth in the Registration Rights Agreement, U. S. Bancorp and the
Trust have agreed that this Prospectus, as it may be amended or supplemented
from time to time, may be used by a Participating Broker-Dealer in connection
with resales of such New Capital Securities for a period ending 180 days after
the Expiration Date (subject to extension under certain limited circumstances
described below) or, if earlier, when all such New Capital Securities have been
disposed of by such Participating Broker-Dealer. See "Plan of Distribution."
However, a Participating Broker-Dealer who intends to use this Prospectus in
connection with the resale of New Capital Securities received in exchange for
Old Capital Securities pursuant to the Exchange Offer must notify U. S. Bancorp
or the Trust, or cause U. S. Bancorp or the Trust to be notified, on or prior to
the Expiration Date, that it is a Participating Broker-Dealer. Such notice may
be given in the space provided for that purpose in the Letter of Transmittal or
may be delivered to the Exchange Agent at one of the addresses set forth herein
under "--Exchange Agent." Any Participating Broker-Dealer who is an Affiliate of
U. S. Bancorp or the Trust may not rely on such interpretive letters and must
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any resale transaction.
In that regard, each Participating Broker-Dealer who surrenders Old
Capital Securities pursuant to the Exchange Offer will be deemed to have agreed,
by execution of the Letter of Transmittal, that, upon receipt of notice from U.
S. Bancorp or the Trust of the occurrence of any event or the discovery of any
fact which makes any statement contained or incorporated by reference in this
Prospectus untrue in any material respect or which causes this Prospectus to
omit to state a material fact necessary in order to make the statements
contained or incorporated by reference herein, in light of the circumstances
under which they were made, not misleading or of the occurrence of certain other
events specified in the Registration Rights Agreement, such Participating
Broker-Dealer will suspend the sale of New Capital Securities
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(or the New Guarantee or the New Junior Subordinated Debentures, as applicable)
pursuant to this Prospectus until U. S. Bancorp or the Trust has amended or
supplemented this Prospectus to correct such misstatement or omission and has
furnished copies of the amended or supplemented Prospectus to such Participating
Broker-Dealer or U. S. Bancorp or the Trust has given notice that the sale of
the New Capital Securities (or the New Guarantee or the New Junior Subordinated
Debentures, as applicable) may be resumed, as the case may be. If U. S. Bancorp
or the Trust gives such notice to suspend the sale of the New Capital Securities
(or the New Guarantee or the New Junior Subordinated Debentures, as applicable),
it shall extend the 180-day period referred to above during which Participating
Broker-Dealers are entitled to use this Prospectus in connection with the resale
of New Capital Securities by the number of days during the period from and
including the date of the giving of such notice to and including the date when
Participating Broker-Dealers shall have received copies of the amended or
supplemented Prospectus necessary to permit resales of the New Capital
Securities or to and including the date on which U. S. Bancorp or the Trust has
given notice that the sale of New Capital Securities (or the New Guarantee or
the New Junior Subordinated Debentures, as applicable) may be resumed, as the
case may be.
WITHDRAWAL RIGHTS
Except as otherwise provided herein, tenders of Old Capital Securities
may be withdrawn at any time on or prior to the Expiration Date.
In order for a withdrawal to be effective, a written or facsimile
transmission of such notice of withdrawal must be timely received by the
Exchange Agent at one of its addresses set forth under "--Exchange Agent" on or
prior to the Expiration Date. Any such notice of withdrawal must specify the
name of the person who tendered the Old Capital Securities to be withdrawn, the
aggregate principal amount of Old Capital Securities to be withdrawn, and (if
certificates for such Old Capital Securities have been tendered) the name of the
registered holder of the Old Capital Securities as set forth on the Old Capital
Securities, if different from that of the person who tendered such Old Capital
Securities. If Old Capital Securities have been delivered or otherwise
identified to the Exchange Agent, then prior to the physical release of such Old
Capital Securities, the tendering holder must submit the serial numbers shown on
the particular Old Capital Securities to be withdrawn and the signature on the
notice of withdrawal must be guaranteed by an Eligible Institution, except in
the case of Old Capital Securities tendered for the account of an Eligible
Institution. If Old Capital Securities have been tendered pursuant to the
procedures for book-entry transfer set forth in "--Procedures for Tendering Old
Capital Securities," the notice of withdrawal must specify the name and number
of the account at DTC to be credited with the withdrawal of Old Capital
Securities, in which case a notice of withdrawal will be effective if delivered
to the Exchange Agent by written, telegraphic, telex or facsimile transmission.
Withdrawals of tenders of Old Capital Securities may not be rescinded. Old
Capital Securities properly withdrawn will not be deemed validly tendered for
purposes of the Exchange Offer, but may be retendered at any subsequent time on
or prior to the Expiration Date by following any of the procedures described
above under "---Procedures for Tendering Old Capital Securities."
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Trust, in its sole
discretion, whose determination shall be final and binding on all parties.
Neither U. S. Bancorp, the Trust, any affiliates or assigns of U. S. Bancorp or
the Trust, the Exchange Agent nor any other person shall be under any duty to
give any notification of any irregularities in any notice of withdrawal or incur
any liability for failure to give any such notification. Any Old Capital
Securities which have been tendered but which are withdrawn will be returned to
the holder thereof promptly after withdrawal.
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DISTRIBUTIONS ON NEW CAPITAL SECURITIES
Holders of Old Capital Securities whose Old Capital Securities are
accepted for exchange will not receive Distributions on such Old Capital
Securities and will be deemed to have waived the right to receive any
Distributions on such Old Capital Securities accumulated from and after June 15,
1997. Accordingly, holders of New Capital Securities as of the record date for
the payment of Distributions on December 15, 1997, will be entitled to receive
Distributions accumulated from and after June 15, 1997.
CONDITIONS TO THE EXCHANGE OFFER
Notwithstanding any other provisions of the Exchange Offer, or any
extension of the Exchange Offer, U. S. Bancorp and the Trust will not be
required to accept for exchange, or to exchange, any Old Capital Securities for
any New Capital Securities, and, as described below, may terminate the Exchange
Offer (whether or not any Old Capital Securities have theretofore been accepted
for exchange) or may waive any conditions to or amend the Exchange Offer, if any
of the following conditions have occurred or exists or have not been satisfied:
(a) there shall occur a change in the current interpretation by the staff
of the Commission which permits the New Capital Securities issued pursuant to
the Exchange Offer in exchange for Old Capital Securities to be offered for
resale, resold and otherwise transferred by holders thereof (other than
broker-dealers and any such holder which is an Affiliate of U. S. Bancorp or the
Trust without compliance with the registration and prospectus delivery
provisions of the Securities Act provided that such New Capital Securities are
acquired in the ordinary course of such holders' business and such holders have
no arrangement or understanding with any person to participate in the
distribution of such New Capital Securities; or
(b) any law, statute, rule or regulation shall have been adopted or
enacted which, in the judgment of U. S. Bancorp or the Trust, would reasonably
be expected to impair its ability to proceed with the Exchange Offer; or
(c) a stop order shall have been issued by the Commission or any state
securities authority suspending the effectiveness of the Registration Statement
or proceedings shall have been initiated or, to the knowledge of U. S. Bancorp
or the Trust, threatened for that purpose, or any governmental approval has not
been obtained, which approval U. S. Bancorp or the Trust, in its sole
discretion, deems necessary for the consummation of the Exchange Offer as
contemplated hereby.
If U. S. Bancorp or the Trust determines in its sole and absolute
discretion that any of the foregoing events or conditions has occurred or exists
or has not been satisfied, it may, subject to applicable law, terminate the
Exchange Offer (whether or not any Old Capital Securities have theretofore been
accepted for exchange) or may waive any such condition or otherwise amend the
terms of the Exchange Offer in any respect. If such waiver or amendment
constitutes a material change to the Exchange Offer, U. S. Bancorp or the Trust
will promptly disclose such waiver or amendment by means of a prospectus
supplement that will be distributed to the registered holders of the Old Capital
Securities and will extend the Exchange Offer to the extent required by Rule
14e-1 under the Exchange Act.
EXCHANGE AGENT
The First National Bank of Chicago has been appointed as Exchange Agent
for the Exchange Offer. Delivery of the Letters of Transmittal and any other
required documents, questions, requests for assistance, and requests for
additional copies of this Prospectus or of the Letter of Transmittal should be
directed to the Exchange Agent as follows:
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BY REGISTERED OR CERTIFIED MAIL, HAND OR OVERNIGHT DELIVERY:
The First National Bank of Chicago
c/o First Chicago Trust Company of New York
14 Wall Street
8th Floor, Window 2
New York, New York 10005
Attn: Corporate Trust Administration
TO CONFIRM BY TELEPHONE OR FOR INFORMATION:
(212) 240-8801
FACSIMILE TRANSMISSIONS:
(ELIGIBLE INSTITUTIONS ONLY)
(212) 240-8938
Delivery to other than the above address or facsimile number will not
constitute a valid delivery.
FEES AND EXPENSES
U. S. Bancorp has agreed to pay the Exchange Agent reasonable and
customary fees for its services and will reimburse it for its reasonable
out-of-pocket expenses in connection therewith. U. S. Bancorp will also pay
brokerage houses and other custodians, nominees and fiduciaries the reasonable
out-of-pocket expenses incurred by them in forwarding copies of this Prospectus
and related documents to the beneficial owners of Old Capital Securities, and in
handling or tendering for their customers.
Holders who tender their Old Capital Securities for exchange will not be
obligated to pay any transfer taxes in connection therewith. If, however, New
Capital Securities are to be delivered to, or are to be issued in the name of,
any person other than the registered holder of the Old Capital Securities
tendered, or if a transfer tax is imposed for any reason other than the exchange
of Old Capital Securities in connection with the Exchange Offer, then the amount
of any such transfer taxes (whether imposed on the registered holder or any
other persons) will be payable by the tendering holder. If satisfactory evidence
of payment of such taxes or exemption therefrom is not submitted with the Letter
of Transmittal, the amount of such transfer taxes will be billed directly to
such tendering holder.
Neither U. S. Bancorp nor the Trust will make any payment to brokers,
dealers or other nominees soliciting acceptances of the Exchange Offer.
DESCRIPTION OF NEW SECURITIES
DESCRIPTION OF NEW CAPITAL SECURITIES
Pursuant to the terms of the Trust Agreement, the Issuer Trustees on
behalf of the Trust have issued the Old Capital Securities and the Common
Securities and will issue the New Capital Securities pursuant to the Exchange
Offer. The New Capital Securities will represent preferred undivided beneficial
interests in the Trust and the holders of the New Capital Securities and the Old
Capital Securities will be entitled to a preference in certain circumstances
with respect to Distributions and amounts payable on redemption of the Capital
Securities or liquidation of the Trust over the Common Securities, as well as
other benefits as described in the Trust Agreement. The Trust Agreement has been
qualified under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). The following summary of certain provisions of the New Capital
Securities and the Trust Agreement does not purport to be complete and is
subject to, and is qualified in its entirety by reference to, all the provisions
of the Trust Agreement, including the definitions therein of certain terms.
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GENERAL
The Capital Securities (including the Old Capital Securities and the New
Capital Securities) are limited to $300,000,000 aggregate Liquidation Amount at
any one time outstanding. The New Capital Securities will rank pari passu, and
payments will be made thereon pro rata, with the Old Capital Securities and the
Common Securities except as described under "--Subordination of Common
Securities." Legal title to the Junior Subordinated Debentures will be held by
the Property Trustee in trust for the benefit of the holders of the Trust
Securities. The New Guarantee will be a guarantee on a subordinated basis with
respect to the Capital Securities but will not guarantee payment of
Distributions or amounts payable on redemption of the New Capital Securities or
liquidation of the Trust when the Trust does not have funds available to make
such payments. See "--Description of New Guarantee."
DISTRIBUTIONS
Distributions on the New Capital Securities will be cumulative, will
accumulate from June 15, 1997, and will be payable at the annual rate of 8.27%
of the stated Liquidation Amount of $1,000, payable semi-annually in arrears on
June 15 and December 15 of each year (each a "Distribution Date"), commencing
December 15, 1997, to the holders of the New Capital Securities as they appear
in the register of the Trust on the relevant record dates. The record dates will
be the June 1 or December 1, as the case may be, next preceding the relevant
Distribution Date. The amount of Distributions payable for any period less than
a full Distribution period will be computed on the basis of a 360-day year of
twelve 30-day months and the actual days elapsed in a partial month in such
period. Distributions payable for each full Distribution period will be computed
by dividing the rate per annum by two. If any date on which Distributions are
payable on the New Capital Securities is not a Business Day (as defined below),
then payment of the Distributions payable on such date will be made on the next
succeeding day that is a Business Day (and without any additional Distributions
or other payment in respect of any such delay), except that, if such Business
Day is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date such payment was originally payable.
So long as no Debenture Event of Default (as defined below) has occurred
and is continuing, U. S. Bancorp will have the right under the New Indenture to
defer payment of interest on the New Junior Subordinated Debentures at any time
or from time to time for a period not exceeding 10 consecutive semi-annual
periods with respect to each Extension Period, provided that no Extension Period
may extend beyond the Stated Maturity of the New Junior Subordinated Debentures.
As a consequence of any such deferral of interest payments by U. S. Bancorp,
semi-annual Distributions on the New Capital Securities by the Trust will also
be deferred during any such Extension Period. Distributions to which holders of
the New Capital Securities are entitled during any such Extension Period will
accumulate additional Distributions thereon at the rate per annum of 8.27%
thereof, compounded semi-annually from the relevant Distribution Date, computed
on the basis of a 360-day year of twelve 30-day months and the actual days
elapsed in a partial month in such period. Additional Distributions payable for
each full Distribution period will be computed by dividing the rate per annum by
two. The term "Distributions" as used herein includes any such additional
Distributions.
During any such Extension Period, U. S. Bancorp may not, and may not
permit any subsidiary of U. S. Bancorp to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of U. S. Bancorp's capital stock, (ii) make any payment of
principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of U. S. Bancorp that rank pari passu with or junior in interest
to the New Junior Subordinated Debentures or (iii) make any guarantee payments
with respect to any guarantee by U. S. Bancorp of the debt securities of any
subsidiary of U. S. Bancorp if such guarantee ranks pari passu with or
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junior in interest to the New Junior Subordinated Debentures (other than (a)
dividends or distributions in capital stock of U. S. Bancorp, (b) any
declaration of a dividend in connection with the implementation of a
shareholders' rights plan or the issuance of rights, stock, or other property
thereunder or the redemption or repurchase of any such rights pursuant thereto,
(c) payments under the Guarantee and (d) repurchases, redemptions or other
acquisitions of common stock of U. S. Bancorp in connection with any employment
contract, benefit plan or similar arrangement with or for the benefit of any one
or more employees, officers, directors or consultants, in connection with a
dividend reinvestment and stock purchase plan, or in connection with the
issuance of common stock (or securities convertible into or exchangeable for
common stock) as consideration in an acquisition transaction entered into prior
to an Extension Period).
Prior to the termination of any such Extension Period, U. S. Bancorp may
further defer the payment of interest on the New Junior Subordinated Debentures,
provided that no Extension Period may exceed 10 consecutive semi-annual periods
or extend beyond the Stated Maturity of the New Junior Subordinated Debentures.
Upon the termination of any such Extension Period and the payment of all
interest then accrued and unpaid (together with interest thereon at the rate of
8.27% compounded semi-annually, to the extent permitted by applicable law), U.
S. Bancorp may elect to begin a new Extension Period. There is no limitation on
the number of times that U. S. Bancorp may elect to begin an Extension Period.
See "--Description of New Junior Subordinated Debentures--Option to Defer
Interest Payments" and "Certain Federal Income Tax Consequences--Interest Income
and Original Issue Discount."
U. S. Bancorp believes that the likelihood of its exercising its right to
defer payments of interest by extending the interest payment period on the
Junior Subordinated Debentures is remote.
The revenue of the Trust available for distribution to holders of the New
Capital Securities will be limited to payments under the New Junior Subordinated
Debentures. If U. S. Bancorp does not make interest payments on the New Junior
Subordinated Debentures, the Trust will not have funds available to pay
Distributions on the New Capital Securities. The payment of Distributions (if
and to the extent the Trust has funds legally available for the payment of such
Distributions) will be guaranteed by U. S. Bancorp on a limited basis as set
forth herein under "--Description of New Guarantee."
REDEMPTION
Upon the repayment or redemption, in whole or in part, of the New Junior
Subordinated Debentures, whether at Stated Maturity or upon earlier redemption
as provided in the New Indenture, the proceeds from such repayment or redemption
shall be applied by the Property Trustee to redeem a Like Amount (as defined
below) of the New Capital Securities, upon not less than 30 nor more than 60
days' prior notice, at a redemption price (the "Redemption Price") equal to the
aggregate Liquidation Amount of such New Capital Securities plus accumulated but
unpaid Distributions thereon to the date of redemption (the "Redemption Date")
and the related amount of the premium, if any, paid by U. S. Bancorp upon the
concurrent redemption of the New Junior Subordinated Debentures. See
"--Description of New Junior Subordinated Debentures--Redemption." If less than
all of the New Junior Subordinated Debentures are to be repaid or redeemed on a
Redemption Date, then the proceeds from such repayment or redemption shall be
allocated to the redemption pro rata of the New Capital Securities and the
Common Securities. The amount of premium, if any, paid by U. S. Bancorp upon the
redemption of all or any part of the New Junior Subordinated Debentures to be
repaid or redeemed on a Redemption Date shall be allocated to the redemption pro
rata of the New Capital Securities and the Common Securities.
U. S. Bancorp will have the right to redeem the New Junior Subordinated
Debentures prior to their Stated Maturity (i) on or after December 15, 2006, in
whole at any time or in part from time to time, or (ii) in whole (but not in
part), at any time within 90 days following the occurrence and during the
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continuation of a Tax Event or Capital Treatment Event, in either case subject
to receipt of prior approval by the Federal Reserve if then required under
applicable capital guidelines or policies of the Federal Reserve. A redemption
of the Junior Subordinated Debentures would cause a mandatory redemption of a
Like Amount of the Capital Securities and Common Securities.
The Redemption Price, in the case of a redemption under (i) above, shall
equal the following prices, expressed in percentages of the Liquidation Amount
(as defined below), together with accumulated Distributions to but excluding the
Redemption Date, if redeemed during the 12-month period beginning December 15:
Redemption
Year Price
---- -----------
2006....................................................... 104.1350%
2007....................................................... 103.7215
2008....................................................... 103.3080
2009....................................................... 102.8945
2010....................................................... 102.4810
2011....................................................... 102.0675
2012....................................................... 101.6540
2013....................................................... 101.2405
2014....................................................... 100.8270
2015....................................................... 100.4135
and at 100% on or after December 15, 2016.
The Redemption Price, in the case of a redemption prior to December 15,
2006, following a Tax Event or Capital Treatment Event as described under (ii)
above, will equal for each New Capital Security the Make-Whole Amount for a
corresponding $1,000 principal amount of New Junior Subordinated Debentures
together with accumulated Distributions to but excluding the Redemption Date.
The "Make-Whole Amount" will be equal to the greater of (i) 100% of the
principal amount of such New Junior Subordinated Debentures or (ii) as
determined by a Quotation Agent (as defined below), the sum of the present
values of the principal amount and premium payable as part of the Redemption
Price with respect to an optional redemption of such New Junior Subordinated
Debentures on December 15, 2006, together with the present values of the
scheduled payments of interest from the Redemption Date to December 15, 2006
(the "Remaining Life"), in each case discounted to the Redemption Date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Adjusted Treasury Rate (as defined below).
"Adjusted Treasury Rate" means, with respect to any Redemption Date, the
Treasury Rate (as defined below) plus (i) 1.30% if such Redemption Date occurs
on or before December 15, 1997 or (ii) 0.50% if such Redemption Date occurs
after December 15, 1997.
A "Business Day" means any day other than a Saturday or a Sunday, or a day
on which banking institutions in The City of New York are authorized or required
by law or executive order to remain closed or a day on which the corporate trust
office of the Debenture Trustee is closed for business.
A "Capital Treatment Event" means the reasonable determination by U. S.
Bancorp that, as a result of any amendment to, or change (including any proposed
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision thereof or therein, or as a result of any official or
administrative pronouncement or action or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which proposed change, pronouncement, action or decision is announced on or
after December 24, 1996, there is more than an insubstantial risk that U. S.
Bancorp will not be entitled to treat an amount equal to the Liquidation Amount
of the New Capital Securities as "Tier I Capital" (or the then equivalent
thereof) for purposes of the capital adequacy guidelines of the Federal Reserve,
as then in effect and applicable to U. S. Bancorp.
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"Comparable Treasury Issue" means with respect to any Redemption Date the
United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Remaining Life that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the Remaining
Life. If no United States Treasury security has a maturity which is within a
period from three months before to three months after December 15, 2006, the two
most closely corresponding United States Treasury securities shall be used as
the Comparable Treasury Issue, and the Treasury Rate shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest month using such
securities.
"Comparable Treasury Price" means (A) the average of five Reference
Treasury Dealer Quotations for such Redemption Date, after excluding the highest
and lowest such Reference Treasury Dealer Quotations, or (B) if the Debenture
Trustee obtains fewer than five such Reference Treasury Dealer Quotations, the
average of all such Quotations.
"Like Amount" means (i) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount (as defined below) equal to that
portion of the principal amount of the Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Capital Securities based upon the relative
Liquidation Amounts of such classes, and (ii) with respect to a distribution of
Junior Subordinated Debentures to holders of Trust Securities in connection with
a dissolution or liquidation of the Trust, Junior Subordinated Debentures having
a principal amount equal to the Liquidation Amount of the Trust Securities of
the holder to whom such Junior Subordinated Debentures are distributed.
"Liquidation Amount" means the stated amount of $1,000 per Trust Security.
"Quotation Agent" means Goldman, Sachs & Co. and its successors; provided,
however, that if the foregoing shall cease to be a primary U. S. Government
securities dealer in New York City (a "Primary Treasury Dealer"), U. S. Bancorp
shall substitute therefor another Primary Treasury Dealer.
"Reference Treasury Dealer" means (i) the Quotation Agent and (ii) any
other Primary Treasury Dealer selected by the Debenture Trustee after
consultation with U. S. Bancorp.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as determined by
the Debenture Trustee, of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted in
writing to the Debenture Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third Business Day preceding such Redemption Date.
"Tax Event" means the receipt by the Trust of an opinion of counsel
experienced in such matters to the effect that, as a result of any amendment to,
or change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which proposed
change, pronouncement or decision is announced on or after December 24, 1996,
there is more than an insubstantial risk that (i) the Trust is, or will be
within 90 days of the date of such opinion, subject to United States federal
income tax with respect to income received or accrued on the Junior Subordinated
Debentures, (ii) interest payable by U. S. Bancorp on the Junior Subordinated
Debentures is not, or within 90 days of the date of such opinion, will not be,
deductible by U. S. Bancorp, in whole or in part, for United States federal
income tax purposes, or (iii) the Trust is, or will be
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within 90 days of the date of such opinion, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
"Treasury Rate" means (i) the yield, under the heading which represents
the average for the week immediately prior to the calculation date, appearing in
the most recently published statistical release designated "H.15(519)" or any
successor publication which is published weekly by the Federal Reserve and which
establishes yields on actively traded United States Treasury securities adjusted
to constant maturity under the caption "Treasury Constant Maturities," for the
maturity corresponding to the Remaining Life (if no maturity is within three
months before or after the Remaining Life, yields for the two published
maturities most closely corresponding to the Remaining Life shall be determined
and the Treasury Rate shall be interpolated or extrapolated from such yields on
a straight-line basis, rounding to the nearest month) or (ii) if such release
(or any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such Redemption Date. The Treasury Rate shall be calculated on the third
Business Day preceding the Redemption Date.
Payment of Additional Sums. If a Tax Event described in clause (i) or (ii)
of the definition of Tax Event above has occurred and is continuing and the
Trust is the holder of all of the Junior Subordinated Debentures, U. S. Bancorp
will pay Additional Sums (as defined below), if any, on the Junior Subordinated
Debentures.
"Additional Sums" means the additional amounts as may be necessary in
order that the amount of Distributions then due and payable by the Trust on the
outstanding Trust Securities will not be reduced as a result of any additional
taxes, duties and other governmental charges to which the Trust has become
subject as a result of a Tax Event.
RIGHT TO SHORTEN MATURITY
If a Tax Event occurs which relates to the deductibility of interest
payable by U. S. Bancorp on the Junior Subordinated Debentures, and if the
opinion relating to such Tax Event and referred to in the definition of Tax
Event above states that the risk of non-deductibility would be avoided if the
maturity of the Junior Subordinated Debentures were shortened, U. S. Bancorp
shall have the right to shorten the maturity of the Junior Subordinated
Debentures by the amount stated in such opinion to be the minimum extent
required in order to avoid such risk, but in no event may U. S. Bancorp shorten
the maturity of the Junior Subordinated Debentures to a Stated Maturity earlier
than June 24, 2016. In such event, the Capital Securities would be redeemed as
of such earlier Stated Maturity of the Junior Subordinated Debentures. In
addition, upon the exercise of the right to shorten the maturity of the Junior
Subordinated Debentures, U. S. Bancorp will no longer have the right to redeem
the Junior Subordinated Debentures prior to the new Stated Maturity upon the
occurrence of a Tax Event or to further shorten the maturity of the Junior
Subordinated Debentures.
REDEMPTION PROCEDURES
New Capital Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the applicable proceeds from the contemporaneous
redemption of the New Junior Subordinated Debentures. Redemptions of the Capital
Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that the Trust has funds on hand available
for the payment of such Redemption Price. See "--Subordination of Common
Securities."
If the Trust gives a notice of redemption in respect of the New Capital
Securities, then, by 12:00 noon, New York City time, on the Redemption Date,
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to the extent funds are available, in the case of New Capital Securities held in
book-entry form, the Property Trustee will deposit irrevocably with DTC funds
sufficient to pay the applicable Redemption Price and will give DTC irrevocable
instructions and authority to pay the Redemption Price to the holders of the New
Capital Securities. See "--Book-Entry, Delivery and Form." With respect to New
Capital Securities not held in book-entry form, the Property Trustee, to the
extent funds are available, will irrevocably deposit with the paying agent for
the New Capital Securities funds sufficient to pay the applicable Redemption
Price and will give such paying agent irrevocable instructions and authority to
pay the Redemption Price to the holders thereof upon surrender of their
certificates evidencing the New Capital Securities. Notwithstanding the
foregoing, Distributions payable on or prior to the Redemption Date for any New
Capital Securities called for redemption shall be payable to the holders of such
New Capital Securities on the relevant record dates for the related Distribution
Dates. If notice of redemption shall have been given and funds deposited as
required, then upon the date of such deposit, all rights of the holders of such
New Capital Securities so called for redemption will cease, except the right of
the holders of the New Capital Securities to receive the Redemption Price, but
without interest on such Redemption Price, and the New Capital Securities will
cease to be outstanding. If any date fixed for redemption of New Capital
Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is a Business Day
(without any interest or other payment in respect of any such delay), except
that, if such Business Day falls in the next calendar year, such payment will be
made on the immediately preceding Business Day. In the event that payment of the
Redemption Price in respect of New Capital Securities called for redemption is
improperly withheld or refused and not paid either by the Trust or by U. S.
Bancorp pursuant to the New Guarantee as described under "--Description of New
Guarantee," Distributions on New Capital Securities will continue to accumulate
at the then applicable rate, from the Redemption Date originally established by
the Trust to the date such Redemption Price is actually paid, in which case the
actual payment date will be the date fixed for redemption for purposes of
calculating the Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities laws), U. S. Bancorp or its subsidiaries may at any time and
from time to time purchase outstanding Capital Securities by tender, in the open
market or by private agreement.
If less than all of the Trust Securities are to be redeemed on a
Redemption Date, then the aggregate Liquidation Amount of such Trust Securities
to be redeemed shall be allocated pro rata to the Capital Securities and the
Common Securities based upon the relative Liquidation Amounts of such classes.
The particular Capital Securities to be redeemed shall be selected on a pro rata
basis not more than 60 days prior to the Redemption Date by the Property Trustee
from the outstanding Capital Securities not previously called for redemption, by
such method as the Property Trustee shall deem fair and appropriate or, if the
Capital Securities are then held in book-entry form, in accordance with DTC's
customary procedures, provided, in each case, that each holder of any Capital
Securities has at least 100 Capital Securities remaining after the redemption.
The Property Trustee shall promptly notify the trust registrar in writing of the
Capital Securities selected for redemption and, in the case of any Capital
Securities selected for partial redemption, the Liquidation Amount thereof to be
redeemed. For all purposes of the Trust Agreement, unless the context otherwise
requires, all provisions relating to the redemption of Capital Securities shall
relate, in the case of any Capital Securities redeemed or to be redeemed only in
part, to the portion of the aggregate Liquidation Amount of Capital Securities
which has been or is to be redeemed.
Notice of any redemption will be mailed at least 30 days but not more than
60 days prior to the Redemption Date to each holder of Trust Securities to be
redeemed at its registered address. Unless U. S. Bancorp defaults in payment of
the Redemption Price on the Junior Subordinated Debentures, on and after the
Redemption Date interest will cease to accrue on the Junior
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Subordinated Debentures or portions thereof (and, unless payment of the
Redemption Price in respect of the Capital Securities is withheld or refused and
not paid either by the Trust or U. S. Bancorp pursuant to the Guarantee,
Distributions will cease to accumulate on the Capital Securities or portions
thereof) called for redemption.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, the Capital
Securities and Common Securities, as applicable, shall be made pro rata based on
the Liquidation Amount of such Capital Securities and Common Securities.
However, if on any Distribution Date or Redemption Date a Debenture Event of
Default has occurred and is continuing as a result of any failure by U. S.
Bancorp to pay amounts in respect of Junior Subordinated Debentures when due, no
payment of any Distribution on, or Redemption Price of, any of the Common
Securities, and no other payment on account of the redemption, liquidation or
other acquisition of such Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all of the
outstanding Capital Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all of the outstanding Capital Securities then
called for redemption, shall have been made or provided for, and all funds
available to the Property Trustee shall first be applied to the payment in full
in cash of all Distributions on, or Redemption Price of, the Capital Securities
then due and payable.
In the case of any Event of Default (as defined below) under the Trust
Agreement resulting from a Debenture Event of Default, U. S. Bancorp as holder
of the Common Securities will be deemed to have waived any right to act with
respect to any such Event of Default under the Trust Agreement until the effect
of all such Events of Default with respect to Capital Securities have been
cured, waived or otherwise eliminated. See "--Events of Default; Notice" and
"--Description of New Junior Subordinated Debentures--Debenture Events of
Default." Until all such Events of Default under the Trust Agreement with
respect to the Capital Securities have been so cured, waived or otherwise
eliminated, the Property Trustee will act solely on behalf of the holders of the
Capital Securities and not on behalf of U. S. Bancorp as holder of the Common
Securities, and only the holders of the Capital Securities will have the right
to direct the Property Trustee to act on their behalf.
LIQUIDATION DISTRIBUTION UPON TERMINATION
The amount payable on the Capital Securities in the event of any
liquidation of the Trust is $1,000 per Capital Security plus accumulated and
unpaid Distributions, which amount may be paid in the form of a distribution of
a Like Amount in Junior Subordinated Debentures, subject to certain exceptions.
Subject to U. S. Bancorp having received prior approval of the Federal
Reserve to do so if then required under applicable capital guidelines or
policies of the Federal Reserve, the holder(s) of all the outstanding Common
Securities have the right at any time to terminate the Trust and, after
satisfaction of liabilities to creditors of the Trust as required by applicable
law, to cause the Junior Subordinated Debentures to be distributed to the
holders of the Trust Securities in exchange therefor upon liquidation of the
Trust.
Pursuant to the Trust Agreement, the Trust will automatically terminate
upon expiration of its term or, if earlier, will terminate on the first to occur
of: (i) certain events of bankruptcy, dissolution or liquidation of the
holder(s) of all the outstanding Common Securities; (ii) the distribution of a
Like Amount of the Junior Subordinated Debentures to the holders of the Trust
Securities, if U. S. Bancorp, as Depositor, has given written direction to the
Property Trustee to terminate the Trust (subject to U. S. Bancorp having
received prior approval of the Federal Reserve if so required under applicable
capital guidelines or policies of the Federal Reserve); (iii) redemption of
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all of the Trust Securities as described under "--Redemption"; and (iv) the
entry of an order for the dissolution of the Trust by a court of competent
jurisdiction.
If an early termination of the Trust occurs as described in clause (i),
(ii) or (iv) above, the Trust will be liquidated by the Property Trustee as
expeditiously as the Property Trustee determines to be possible by distributing,
after satisfaction of liabilities to creditors of the Trust as required by
applicable law, to the holders of the Trust Securities in exchange therefor a
Like Amount of the Junior Subordinated Debentures, unless such distribution is
determined by the Property Trustee not to be practical, in which event such
holders will be entitled to receive out of the assets of the Trust available for
distribution to holders, after satisfaction of liabilities to creditors of the
Trust as required by applicable law, an amount equal to, in the case of holders
of Capital Securities, the aggregate of the Liquidation Amount plus accrued and
unpaid Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution"). If such Liquidation Distribution can be paid only
in part because the Trust has insufficient assets available to pay in full the
aggregate Liquidation Distribution, then the amounts payable directly by the
Trust on its Capital Securities shall be paid on a pro rata basis. The holder(s)
of the Common Securities will be entitled to receive distributions upon any such
liquidation pro rata with the holders of the Capital Securities, except that if
a Debenture Event of Default has occurred and is continuing as a result of any
failure by U. S. Bancorp to pay any amounts in respect of the Junior
Subordinated Debentures when due, the Capital Securities shall have priority
over the Common Securities.
After the liquidation date is fixed for any distribution of Junior
Subordinated Debentures (i) the Capital Securities will no longer be deemed to
be outstanding, (ii) DTC or its nominee, as the registered holder of the Capital
Securities, will receive a registered global certificate or certificates
representing the Junior Subordinated Debentures to be delivered upon such
distribution with respect to the Capital Securities held by DTC or its nominee
and (iii) any certificates representing the Capital Securities not held by DTC
or its nominee will be deemed to represent Junior Subordinated Debentures having
a principal amount equal to the stated Liquidation Amount of such Capital
Securities, and bearing accrued and unpaid interest in an amount equal to the
accumulated and unpaid Distributions on such Capital Securities until such
certificates are presented to the trust registrar for cancellation, whereupon U.
S. Bancorp will issue to such holder, and the Debenture Trustee will
authenticate, a certificate representing such Junior Subordinated Debentures.
If U. S. Bancorp does not redeem the Junior Subordinated Debentures prior
to maturity and the Trust is not liquidated and the Junior Subordinated
Debentures are not distributed to holders of the Capital Securities, the Capital
Securities will remain outstanding until the repayment of the Junior
Subordinated Debentures and the distribution of the Liquidation Distribution to
the holders of the Capital Securities.
There can be no assurance as to the market prices for the New Capital
Securities or the New Junior Subordinated Debentures that may be distributed in
exchange for New Capital Securities if a termination and liquidation of the
Trust were to occur. Accordingly, the New Capital Securities that an investor
may purchase, or the New Junior Subordinated Debentures that an investor may
receive on termination and liquidation of the Trust, may trade at a discount to
the price that the investor paid to acquire the New Capital Securities offered
hereby.
EVENTS OF DEFAULT; NOTICE
Any one of the following events constitutes an "Event of Default" under
the Trust Agreement with respect to the Capital Securities (whatever the reason
for such Event of Default and whether it is voluntary or involuntary or effected
by operation of law or pursuant to any judgment, decree or order of
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any court or any order, rule or regulation of any administrative or governmental
body):
(i) The occurrence of a Debenture Event of Default under the Indenture
(see "--Description of New Junior Subordinated Debentures--Debenture
Events of Default"); or
(ii) Default by the Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of
30 days; or
(iii) Default by the Trust in the payment of any Redemption Price of any
Trust Security when it becomes due and payable; or
(iv) Default in the performance, or breach, in any material respect, of
any covenant or warranty of the Trustees in the Trust Agreement (other
than a covenant or warranty a default in the performance of which or the
breach of which is dealt with in clause (ii) or (iii) above), and
continuation of such default or breach for a period of 60 days after there
has been given, by registered or certified mail, to the defaulting Issuer
Trustee or Trustees by the holders of at least 25% in aggregate
Liquidation Amount of the outstanding Capital Securities, a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" under the Trust
Agreement; or
(v) The occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee if a successor Property Trustee has not
been appointed within 60 days thereof.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee will transmit
notice of such Event of Default to the holders of the Capital Securities, the
Administrative Trustees and U. S. Bancorp, as Depositor, unless such Event of
Default has been cured or waived. U. S. Bancorp, as Depositor, and the
Administrative Trustees are required to file annually with the Property Trustee
a certificate as to whether or not they are in compliance with all the
conditions and covenants applicable to them under the Trust Agreement.
If a Debenture Event of Default has occurred and is continuing as a result
of any failure by U. S. Bancorp to pay any amount in respect of Junior
Subordinated Debentures when due, the Capital Securities will have a preference
over the Common Securities as described above. See "--Subordination of Common
Securities" and "--Liquidation Distribution Upon
Termination."
The existence of an Event of Default does not entitle the holders of
Capital Securities to accelerate the maturity thereof.
REMOVAL OF ISSUER TRUSTEES
The holders of at least a majority in aggregate Liquidation Amount of the
outstanding Capital Securities may remove an Issuer Trustee for cause or, if a
Debenture Event of Default has occurred and is continuing, with or without
cause. If an Issuer Trustee is removed by the holders of the outstanding Capital
Securities, the successor may be appointed by the holders of at least 25% in
Liquidation Amount of the outstanding Capital Securities. If an Issuer Trustee
resigns, such Trustee will appoint its successor. If the Issuer Trustee fails to
appoint a successor, the holders of at least 25% in Liquidation Amount of the
outstanding Capital Securities may appoint a successor. If a successor has not
been appointed by the holders, any holder of Capital Securities or Common
Securities or the other Issuer Trustee may petition a court in the State of
Delaware to appoint a successor. Any Delaware Trustee must meet the applicable
requirements of Delaware law. Any Property Trustee must be a national or
state-chartered bank, and at the time of appointment have securities rated in
one of the three highest rating
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categories by a nationally recognized statistical rating organization and have
capital and surplus of at least $50,000,000. No resignation or removal of an
Issuer Trustee and no appointment of a successor trustee shall be effective
until the acceptance of appointment by the successor trustee in accordance with
the provisions of the Trust Agreement.
MERGER OR CONSOLIDATION OF ISSUER TRUSTEES
Any Person into which the Property Trustee or the Delaware Trustee may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Issuer
Trustee is a party, or any Person succeeding to all or substantially all the
corporate trust business of such Issuer Trustee, will be the successor of such
Trustee under the Trust Agreement, provided such Person is otherwise qualified
and eligible.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE TRUST
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except as
described below or otherwise set forth in the Trust Agreement. The Trust may, at
the request of the holder(s) of all the outstanding Common Securities, without
the consent of holders of any Capital Securities, merge with or into,
consolidate, amalgamate, or be replaced by, or convey, transfer or lease its
properties and assets substantially as an entirety to, a trust organized as such
under the laws of any State; provided, that (i) such successor entity either (a)
expressly assumes all of the obligations of the Trust with respect to the
Capital Securities or (b) substitutes for the Capital Securities other
securities having substantially the same terms as the Capital Securities (the
"Successor Securities") so long as the Successor Securities rank the same as the
Capital Securities in priority with respect to distributions and payments upon
liquidation, redemption and otherwise, (ii) a trustee of such successor entity
possessing the same powers and duties as the Property Trustee is appointed to
hold the Junior Subordinated Debentures, (iii) the Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which the
Capital Securities are then listed, if any, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
Capital Securities (including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization which gives ratings on the
Capital Securities, (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Capital Securities (including any Successor
Securities) in any material respect, (vi) such successor entity has a purpose
identical to that of the Trust, (vii) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, U. S. Bancorp has
received an opinion from independent counsel to the Trust experienced in such
matters to the effect that (a) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the Capital Securities (including
any Successor Securities) in any material respect, and (b) following such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease,
neither the Trust nor such successor entity will be required to register as an
investment company under the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and (viii) U. S. Bancorp or any permitted successor
or assignee owns all of the common securities of such successor entity and
guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee. Notwithstanding the
foregoing, the Trust shall not, except with the consent of holders of 100% in
Liquidation Amount of the Capital Securities, consolidate, amalgamate, merge
with or into, or be replaced by or convey, transfer or lease its properties and
assets substantially as an entirety to any other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement,
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conveyance, transfer or lease would cause the Trust or the successor entity to
be classified as an association taxable as a corporation or as other than a
grantor trust for United States federal income tax purposes.
VOTING RIGHTS; AMENDMENT OF THE TRUST AGREEMENT
Except as provided below and under "--Removal of Issuer Trustees" and
"--Description of New Guarantee--Amendments and Assignment" and as otherwise
required by law and the Trust Agreement, the holders of the Capital Securities
will have no voting rights.
The Trust Agreement may be amended from time to time by holders of a
majority in aggregate Liquidation Amount of the Common Securities and the
Property Trustee, without the consent of the holders of the Capital Securities
(i) to cure any ambiguity, correct or supplement any provisions in the Trust
Agreement that may be inconsistent with any other provision, or to make any
other provisions with respect to matters or questions arising under the Trust
Agreement, which are not inconsistent with the other provisions of the Trust
Agreement, or (ii) to modify, eliminate or add to any provisions of the Trust
Agreement to such extent as may be necessary to ensure that the Trust will not
be classified for United States federal income tax purposes as an association
taxable as a corporation and will be classified as a grantor trust at all times
that any Trust Securities are outstanding and to ensure that the Trust will not
be required to register as an "investment company" under the Investment Company
Act; provided, however, that in the case of either clause (i) or clause (ii),
such action shall not adversely affect in any material respect the interests of
any holder of Capital Securities, and any amendments of the Trust Agreement will
become effective when notice thereof is given to the holders of the Trust
Securities. The Trust Agreement may be amended by the Property Trustee and
holders of a majority in aggregate Liquidation Amount of the Common Securities
with (i) the consent of holders representing not less than a majority (based
upon Liquidation Amounts) of the outstanding Capital Securities, and (ii)
receipt by the Issuer Trustees of an opinion of counsel to the effect that such
amendment or the exercise of any power granted to the Issuer Trustees in
accordance with such amendment will not affect the Trust's status as a grantor
trust for United States federal income tax purposes or the Trust's exemption
from status as an "investment company" under the Investment Company Act, except
that without the consent of each holder of Trust Securities, the Trust Agreement
may not be amended to (i) change the amount or timing of any Distribution on the
Trust Securities or otherwise adversely affect the amount of any Distribution
required to be made in respect of the Trust Securities as of a specified date or
(ii) restrict the right of a holder of Trust Securities to institute suit for
the enforcement of any such payment on or after such date.
So long as any Junior Subordinated Debentures are held by the Trust, the
Property Trustee will not (i) direct the time, method and place of conducting
any proceeding for any remedy available to the Debenture Trustee, or execute any
trust or power conferred on the Property Trustee with respect to the Junior
Subordinated Debentures, (ii) waive any past default that is waivable under
Section 513 of the Indenture, (iii) exercise any right to rescind or annul a
declaration that the principal of all the Junior Subordinated Debentures shall
be due and payable or (iv) consent to any amendment, modification or termination
of the Indenture or the Junior Subordinated Debentures, where such consent shall
be required, without, in each case, obtaining the prior approval of the holders
of at least a majority in aggregate Liquidation Amount of the outstanding
Capital Securities, except that if a consent under the Indenture would require
the consent of each holder of Junior Subordinated Debentures affected thereby,
no such consent will be given by the Property Trustee without the prior consent
of each holder of the Capital Securities. The Issuer Trustees may not revoke any
action previously authorized or approved by a vote of the holders of the Capital
Securities except by subsequent vote of the holders of the Capital Securities.
The Property Trustee will notify each holder of Capital Securities of any notice
of default with respect to the Junior Subordinated Debentures. In addition to
obtaining the foregoing approvals of the holders of the Capital Securities,
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before taking any of the foregoing actions, the Property Trustee will obtain an
opinion of counsel experienced in such matters to the effect that the Trust will
not be classified as an association taxable as a corporation for United States
federal income tax purposes on account of such action and such action would not
cause the Trust to be classified as other than a grantor trust for United States
federal income tax purposes.
Any required approval of holders of Capital Securities may be given at a
meeting of such holders convened for such purpose or pursuant to written
consent. The Property Trustee will cause a notice of any meeting at which
holders of Capital Securities are entitled to vote, or of any matter upon which
action by written consent of such holders is to be taken, to be given to each
holder of record of Capital Securities in the manner set forth in the Trust
Agreement.
No vote or consent of the holders of Capital Securities will be required
for the Trust to redeem and cancel the Capital Securities in accordance with the
Trust Agreement.
Notwithstanding that holders of the Capital Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Capital Securities that are owned by U. S. Bancorp, the Issuer Trustees or any
affiliate of U. S. Bancorp or the Issuer Trustees will, for purposes of such
vote or consent, be treated as if they were not outstanding.
BOOK ENTRY, DELIVERY AND FORM
The New Capital Securities initially will be represented by one or more
New Capital Securities in registered, global form (collectively, the "Global New
Capital Securities") and, together with the Old Capital Securities in
registered, global form, the "Global Capital Securities"). The Global New
Capital Securities will be deposited upon issuance with the Property Trustee as
custodian for DTC, in New York, New York, and registered in the name of DTC or
its nominee, in each case for credit to an account of a direct or indirect
participant in DTC as described below.
The New Capital Securities will be issued in minimum blocks of at least
100 (representing a minimum of $100,000 aggregate Liquidation Amount) and the
New Capital Securities must at all times be held in blocks of at least 100.
Except as set forth below, the Global Capital Securities may be
transferred, in whole and not in part, only to another nominee of DTC or to a
successor of DTC or its nominee. Beneficial interests in the Global Capital
Securities may not be exchanged for Capital Securities in certificated form
except in the limited circumstances described below.
DTC has advised U. S. Bancorp and the Trust that DTC is a limited purpose
trust company created to hold securities for its participating organizations
(collectively, the "Participants") and to facilitate the clearance and
settlement of transactions in those securities between Participants through
electronic book-entry changes in accounts of its Participants. The Participants
include securities brokers and dealers (including the Initial Purchasers),
banks, trust companies, clearing corporations and certain other organizations.
Access to DTC's system is also available to other entities such as banks,
brokers, dealers and trust companies that clear through or maintain a custodian
relationship with a Participant, either directly or indirectly (collectively,
the "Indirect Participants"). Persons who are not Participants may beneficially
own securities held by or on behalf of DTC only through the Participants or the
Indirect Participants. The ownership interest and transfer of ownership interest
of each actual purchaser of each security held by or on behalf of DTC are
recorded on the records of the Participants and Indirect Participants.
DTC has also advised U. S. Bancorp and the Trust that, pursuant to
procedures established by it, (i) upon deposit of the Global Capital Securities,
DTC will credit the accounts of Participants with portions of the
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Liquidation Amount of the Global Capital Securities and (ii) ownership of such
interests in the Global Capital Securities will be shown on, and the transfer of
ownership thereof will be effected only through, records maintained by DTC (with
respect to the Participants) or by the Participants and the Indirect
Participants (with respect to other owners of beneficial interests in the Global
Capital Securities).
Except as described below, owners of beneficial interests in the Global
Capital Securities will not have Capital Securities registered in their name,
will not receive physical delivery of Capital Securities in certificated form
and will not be considered the registered owners or holders thereof under the
Trust Agreement for any purpose.
Payments in respect of the Global Capital Securities registered in the
name of DTC or its nominee will be payable by the Property Trustee to DTC in its
capacity as the registered holder under the Trust Agreement. Under the terms of
the Trust Agreement, the Property Trustee will treat the persons in whose names
the Capital Securities, including the Global Capital Securities, are registered
as the owners thereof for the purpose of receiving such payments and for any and
all other purposes whatsoever. Consequently, neither the Property Trustee nor
any agent thereof has or will have any responsibility or liability for (i) any
aspect of DTC's records or any Participant's or Indirect Participant's records
relating to or payments made on account of beneficial interests in the Global
Capital Securities, or for maintaining, supervising or reviewing any of DTC's
records or any Participant's or Indirect Participant's records relating to the
beneficial interests in the Global Capital Securities or (ii) any other matter
relating to the actions and practices of DTC or any of its Participants or
Indirect Participants. DTC has advised U. S. Bancorp and the Trust that its
current practice, upon receipt of any payment in respect of securities such as
the Capital Securities, is to credit the accounts of the relevant Participants
with the payment on the payment date, in amounts proportionate to their
respective holdings in Liquidation Amount of beneficial interests in the
relevant security as shown on the records of DTC unless DTC has reason to
believe it will not receive payment on such payment date. Payments by the
Participants and the Indirect Participants to the beneficial owners of Global
Capital Securities will be governed by standing instructions and customary
practices and will be the responsibility of the Participants or the Indirect
Participants and will not be the responsibility of DTC, the Property Trustee, U.
S. Bancorp or the Trust. Neither U. S. Bancorp or the Trust nor the Property
Trustee will be liable for any delay by DTC or any of its Participants in
identifying the beneficial owners of the Global Capital Securities, and U. S.
Bancorp, the Trust, and the Property Trustee may conclusively rely on and will
be protected in relying on instructions from DTC or its nominee for all
purposes.
Beneficial interests in the Global Capital Securities will trade in DTC's
Same-Day Funds Settlement System and secondary market trading activity in such
interests will therefore settle in immediately available funds, subject in all
cases to the rules and procedures of DTC and its participants.
DTC has advised U. S. Bancorp and the Trust that it will take any action
permitted to be taken by a holder of Capital Securities only at the direction of
one or more Participants to whose account with DTC interests in the Global
Capital Securities are credited and only in respect of such portion of the
Liquidation Amount of the Capital Securities as to which such Participant or
Participants has or have given such direction. However, if there is an Event of
Default under the Trust Agreement, DTC reserves the right to exchange the Global
Capital Securities for Capital Securities in certificated form and to distribute
such Capital Securities to its Participants.
The information in this section concerning DTC and its book-entry system
has been obtained from sources that U. S. Bancorp and the Trust believe to be
reliable, but neither U. S. Bancorp nor the Trust takes responsibility for the
accuracy thereof.
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A Global New Capital Security is exchangeable for New Capital Securities
in registered certificated form if (i) DTC (x) notifies the Trust that it is
unwilling or unable to continue as depositary for the Global New Capital
Security and the Trust thereupon fails to appoint a successor depositary within
90 days or (y) has ceased to be a clearing agency registered under the Exchange
Act, (ii) U. S. Bancorp in its sole discretion elects to cause the issuance of
the New Capital Securities in certificated form or (iii) there shall have
occurred and be continuing and Event of Default or any event which after notice
or lapse of time or both would be an Event of Default under the Trust Agreement.
In addition, beneficial interests in a Global New Capital Security may be
exchanged for certificated New Capital Securities upon request but only upon at
least 20 days' prior written notice given to the Property Trustee by or on
behalf of DTC in accordance with customary procedures. In all cases,
certificated New Capital Securities delivered in exchange for any Global New
Capital Security or beneficial interests therein will be registered in the
names, and issued in any approved denominations, requested by or on behalf of
DTC (in accordance with its customary procedures), unless the Property Trustee
determines otherwise in compliance with applicable law.
PAYMENT AND PAYING AGENTS
Payments in respect of the New Capital Securities held in global form will
be made to DTC, which will credit the relevant accounts at DTC on the applicable
Distribution Dates or, with respect to the New Capital Securities that are not
held by DTC or its nominee, such payments will be made by check mailed to the
address of the holder entitled thereto as such address appears on the trust
register. The paying agent (the "Paying Agent") will initially be the Property
Trustee and any co-paying agent chosen by the Property Trustee and acceptable to
the Administrative Trustees. The Paying Agent will be permitted to resign as
Paying Agent upon 30 days' written notice to the Property Trustee and the
Administrative Trustees. If the Property Trustee is no longer the Paying Agent,
the Property Trustee will appoint a successor (which must be a bank or trust
company acceptable to the Administrative Trustees) to act as Paying Agent.
REGISTRAR AND TRANSFER AGENT
The Property Trustee will act as registrar and transfer agent for the New
Capital Securities.
Registration of transfers of New Capital Securities will be effected
without charge by or on behalf of the Trust, other than payment of any tax or
other governmental charges that may be imposed in connection with any transfer
or exchange. The Trust will not be required to register or cause to be
registered the transfer of New Capital Securities after they have been called
for redemption.
TRUST EXPENSES
Pursuant to the Expense Agreement, U. S. Bancorp, as holder of the Common
Securities, has irrevocably and unconditionally agreed with the Trust that U. S.
Bancorp will pay to the Trust, and reimburse the Trust for, the full amount of
any costs, expenses or liabilities of the Trust, other than obligations of the
Trust to pay to the holders of Capital Securities or other similar interests in
the Trust the amounts due such holders pursuant to the terms of the Capital
Securities or such other similar interests, as the case may be. Such payment
obligation will include any such costs, expenses or liabilities of the Trust
that are required by applicable law to be satisfied in connection with
termination of the Trust.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than during the occurrence and continuance of
an Event of Default, undertakes to perform only such duties as are specifically
set forth in the Trust Agreement and, after such Event of Default, must exercise
the same degree of care and skill as a prudent person
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would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is under no obligation to exercise any of the
powers vested in it by the Trust Agreement at the request of any holder of
Capital Securities unless it is offered reasonable indemnity against the costs,
expenses and liabilities that might be incurred thereby. If no Event of Default
has occurred and is continuing and the Property Trustee is required to decide
between alternative courses of action or to construe ambiguous provisions in the
Trust Agreement or is unsure of the application of any provision of the Trust
Agreement, and the matter is not one on which holders of Capital Securities are
entitled under the Trust Agreement to vote, then the Property Trustee will take
such action as it deems advisable and in the best interests of the holders of
the Trust Securities and will have no liability except for its own bad faith,
negligence or willful misconduct.
For information concerning the relationships between The First National
Bank of Chicago, the Property Trustee, and U. S. Bancorp, see "--Description of
New Junior Subordinated Debentures--Information Concerning the Debenture
Trustee."
MISCELLANEOUS
The Administrative Trustees and the Property Trustee are authorized and
directed to conduct the affairs of and to operate the Trust in such a way that
it will not be deemed to be an "investment company" required to be registered
under the Investment Company Act or classified as an association taxable as a
corporation or as other than a grantor trust for United States federal income
tax purposes and so that the Junior Subordinated Debentures will be treated as
indebtedness of U. S. Bancorp for United States federal income tax purposes. In
this connection, the holders of a majority in aggregate Liquidation Amount of
the outstanding Common Securities and the Property Trustee are authorized to
take any action, not inconsistent with applicable law, the certificate of trust
of the Trust or the Trust Agreement, that the holders of a majority in aggregate
Liquidation Amount of the outstanding Common Securities and the Property Trustee
determine in their discretion to be necessary or desirable for such purposes, as
long as such action does not materially adversely affect the interests of the
holders of the Capital Securities.
Holders of the Capital Securities have no preemptive or similar rights.
The Trust may not borrow money or issue debt or mortgage or pledge any of
its assets.
DESCRIPTION OF NEW JUNIOR SUBORDINATED DEBENTURES
The Old Junior Subordinated Debentures were issued under the Old
Indenture. The New Junior Subordinated Debentures will be issued under the New
Indenture, under which The First National Bank of Chicago is acting as Debenture
Trustee. The New Indenture has been qualified under the Trust Indenture Act.
This summary of certain terms and provisions of the New Junior Subordinated
Debentures and the New Indenture does not purport to be complete, and where
reference is made to particular provisions of the New Indenture, such
provisions, including the definition of certain terms, some of which are not
otherwise defined herein, are qualified in their entirety by reference to all of
the provisions of the New Indenture and those terms made a part of the New
Indenture by the Trust Indenture Act.
GENERAL
Concurrently with the issuance of the Old Capital Securities, the Trust
invested the proceeds thereof, together with the consideration paid by U. S.
Bancorp for the Common Securities, in Old Junior Subordinated Debentures issued
by U. S. Bancorp. Pursuant to the Exchange Offer, U. S. Bancorp will exchange
the Old Junior Subordinated Debentures, in an amount corresponding to the Old
Capital Securities accepted for exchange, for a like aggregate principal amount
of the New Junior Subordinated Debentures promptly after the Expiration Date.
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The New Junior Subordinated Debentures will bear interest at the annual
rate of 8.27% of the principal amount thereof, payable semi-annually in arrears
on June 15 and December 15 of each year (each, an "Interest Payment Date"),
commencing December 15, 1997, to the person in whose name each Junior
Subordinated Debenture is registered at the close of business on the June 1 or
December 1 next preceding such Interest Payment Date (the "Regular Record
Date"). It is anticipated that, until the liquidation, if any, of the Trust,
each New Junior Subordinated Debenture will be held by the Property Trustee in
trust for the benefit of the holders of the Trust Securities. The amount of
interest payable for any period less than a full interest period will be
computed on the basis of a 360-day year of twelve 30-day months and the actual
days elapsed in a partial month in such period. The amount of interest payable
for any full interest period will be computed by dividing the rate per annum by
two. If any date on which interest is payable on the New Junior Subordinated
Debentures is not a Business Day, then payment of the interest payable on such
date will be made on the next succeeding day that is a Business Day (and without
any interest or other payment in respect of any such delay), except that, if
such Business Day is in the next succeeding calendar year, such payment will be
made on the immediately preceding Business Day, in each case with the same force
and effect as if made on the date such payment was originally payable. Accrued
interest that is not paid on the applicable Interest Payment Date will bear
additional interest on the amount thereof (to the extent permitted by law) at
the rate per annum of 8.27% thereof, compounded semi-annually and computed on
the basis of a 360-day year of twelve 30-day months and the actual days elapsed
in a partial month in such period. The amount of additional interest payable for
any full interest period will be computed by dividing the rate per annum by two.
The term "interest" as used herein includes semi-annual interest payments,
interest on semi-annual interest payments not paid on the applicable Interest
Payment Date and Additional Sums (as defined below), as applicable.
The New Junior Subordinated Debentures will mature on December 15, 2026.
The New Junior Subordinated Debentures will rank pari passu with the Old
Junior Subordinated Debentures and will be unsecured and subordinate and junior
in right of payment to all Senior Debt of U. S. Bancorp. Because U. S. Bancorp
is a bank holding company, its rights and the rights of its creditors to
participate in any distribution of assets of any subsidiary upon the latter's
liquidation or reorganization or otherwise is subject to the prior claims of
creditors of that subsidiary (including depositors in the case of bank
subsidiaries), except to the extent that U. S. Bancorp may itself be a creditor
with recognized claims against that subsidiary. There are also various legal
limitations on the extent to which certain of U. S. Bancorp's subsidiaries may
extend credit, pay dividends or otherwise supply funds to U. S. Bancorp or
certain of its other subsidiaries. See "Certain Regulatory Considerations."
Accordingly, the New Junior Subordinated Debentures will be effectively
subordinated to all existing and future liabilities of U. S. Bancorp's
subsidiaries, and holders thereof should look only to the assets of U. S.
Bancorp for payments on the New Junior Subordinated Debentures. The Indenture
does not limit the incurrence or issuance of other secured or unsecured debt of
U. S. Bancorp, including Senior Debt, whether under any existing indenture or
any other indenture that U. S. Bancorp may enter into in the future or
otherwise. See "--Subordination."
FORM, REGISTRATION AND TRANSFER. If the New Junior Subordinated Debentures
are distributed to holders of the New Capital Securities, such New Junior
Subordinated Debentures may be represented by one or more global certificates
registered in the name of Cede & Co. as the nominee of DTC. The New Junior
Subordinated Debentures will be issuable and transferable only in denominations
of $100,000 and integral multiples of $1,000 in excess thereof. The depositary
arrangements for such New Junior Subordinated Debentures are expected to be
substantially similar to those in effect for the New Capital Securities. For a
description of DTC and the terms of the depositary arrangements relating to
payments, transfers, voting rights, redemptions and other notices and matters,
see "--Description of New Capital Securities--Book-Entry, Delivery and Form."
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PAYMENT AND PAYING AGENTS
Payment of principal of (and premium, if any) and any interest on New
Junior Subordinated Debentures will be made at the office of the Debenture
Trustee in The City of New York, except that at the option of U. S. Bancorp
payment of any interest may be made, except in the case of New Junior
Subordinated Debentures represented by a global security, (i) by check mailed to
the address of the person entitled thereto as such address appears in the
securities register or (ii) by transfer to an account maintained by the person
entitled thereto as specified in the securities register, provided that proper
transfer instructions have been received by the Regular Record Date. Payment of
any interest on a New Junior Subordinated Debenture will be made to the person
in whose name such New Junior Subordinated Debenture is registered at the close
of business on the Regular Record Date for such interest, except in the case of
defaulted interest. U. S. Bancorp may at any time designate additional paying
agents or rescind the designation of any paying agent; however, U. S. Bancorp
will at all times be required to maintain a paying agent in each place of
payment for the New Junior Subordinated Debentures.
Any moneys deposited with the Debenture Trustee or any paying agent, or
then held by U. S. Bancorp in trust, for the payment of the principal of (and
premium, if any) or interest on any New Junior Subordinated Debenture and
remaining unclaimed for two years after such principal (and premium, if any) or
interest has become due and payable shall, at the request of U. S. Bancorp, be
repaid to U. S. Bancorp and the holder of such New Junior Subordinated Debenture
shall thereafter look, as a general unsecured creditor, only to U. S. Bancorp
for payment thereof.
OPTION TO DEFER INTEREST PAYMENTS
So long as no Debenture Event of Default has occurred and is continuing,
U. S. Bancorp has the right under the New Indenture at any time or from time to
time during the term of the New Junior Subordinated Debentures to defer payment
of interest on the New Junior Subordinated Debentures for a period not exceeding
10 consecutive semi-annual periods with respect to each Extension Period,
provided that no Extension Period may extend beyond the Stated Maturity of the
New Junior Subordinated Debentures. At the end of such Extension Period, U. S.
Bancorp must pay all interest then accrued and unpaid on the New Junior
Subordinated Debentures (together with interest on such unpaid interest at the
annual rate of 8.27%, compounded semi-annually and computed on the basis of a
360-day year of twelve 30-day months and the actual days elapsed in a partial
month in a period, to the extent permitted by applicable law). The amount of
additional interest payable for any full interest period will be computed by
dividing the rate per annum by two. During an Extension Period, interest will
accrue and holders of New Junior Subordinated Debentures (or holders of Capital
Securities while Capital Securities are outstanding) will be required to accrue
interest income for United States federal income tax purposes. See "Certain
Federal Income Tax Consequences--Interest Income and Original Issue Discount."
During any such Extension Period, U. S. Bancorp may not, and may not
permit any subsidiary of U. S. Bancorp to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of U. S. Bancorp's capital stock, (ii) make any payment of
principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of U. S. Bancorp that rank pari passu with or junior in interest
to the New Junior Subordinated Debentures or (iii) make any guarantee payments
with respect to any guarantee by U. S. Bancorp of the debt securities of any
subsidiary of U. S. Bancorp if such guarantee ranks pari passu with or junior in
interest to the New Junior Subordinated Debentures (other than (a) dividends or
distributions in capital stock of U. S. Bancorp, (b) any declaration of a
dividend in connection with the implementation or amendment of a shareholders'
rights plan or any successor thereto or the issuance of rights, stock or other
property thereunder or the redemption or repurchase of any such rights pursuant
thereto, (c) payments under the Guarantee and (d) repurchases, redemptions or
other acquisitions of common stock of
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U. S. Bancorp in connection with any employment contract, benefit plan or
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
and stock purchase plan, or in connection with the issuance of common stock (or
securities convertible or exchangeable for common stock) as consideration in an
acquisition transaction entered into prior to an Extension Period).
Prior to the termination of any such Extension Period, U. S. Bancorp may
further defer the payment of interest on the New Junior Subordinated Debentures,
provided that no Extension Period may exceed 10 consecutive semi-annual periods
or extend beyond the Stated Maturity of the New Junior Subordinated Debentures.
Upon the termination of any such Extension Period and the payment of all
interest then accrued and unpaid (together with interest thereon at the rate of
8.27%, compounded semi-annually, to the extent permitted by applicable law), U.
S. Bancorp may elect to begin a new Extension Period subject to the above
requirements. No interest shall be due and payable during an Extension Period,
except at the end thereof. U. S. Bancorp must give the Property Trustee, the
Administrative Trustees and the Debenture Trustee notice of its election to
begin such Extension Period at least one Business Day prior to the earliest of
(i) the date interest on the New Junior Subordinated Debentures would have been
payable except for the election to begin such Extension Period, (ii) the date
the Administrative Trustees are required to give notice to the New York Stock
Exchange, the Nasdaq National Market or other applicable stock exchange or
automated quotation system on which the New Capital Securities are then listed
or quoted or to holders of the New Capital Securities of the record date for
such Distributions and (iii) the date such Distributions would have been payable
but for the election to begin such Extension Period, but in any event not less
than one Business Day prior to such record date. The Property Trustee will give
notice of U. S. Bancorp's election to begin a new Extension Period to the
holders of the Capital Securities. There is no limitation on the number of times
that U. S. Bancorp may elect to begin an Extension Period.
REDEMPTION
Subject to U. S. Bancorp having received prior approval of the Federal
Reserve if then required under applicable capital guidelines or policies of the
Federal Reserve, the Junior Subordinated Debentures are redeemable prior to
maturity at the option of U. S. Bancorp (i) on or after December 15, 2006, in
whole at any time or in part from time to time, or (ii) in whole (but not in
part), at any time within 90 days following the occurrence and continuation of a
Tax Event or Capital Treatment Event (each as defined under "Risk Factors--Tax
Event or Capital Treatment Event Redemption"), in either case at the redemption
price (the "Redemption Price") described below. The proceeds of any such
redemption will be used by the Trust to redeem the Capital Securities.
The Redemption Price for Junior Subordinated Debentures in the case of a
redemption under (i) above or, on or after December 15, 2006, under (ii) above,
shall equal the following prices, expressed in percentages of the principal
amount, together with accrued interest to but excluding the date fixed for
redemption. If redeemed during the 12-month period beginning December 15:
REDEMPTION
YEAR PRICE
---- ----------
2006...................................... 104.1350%
2007...................................... 103.7215
2008...................................... 103.3080
2009...................................... 102.8945
2010...................................... 102.4810
2011...................................... 102.0675
2012...................................... 101.6540
2013...................................... 101.2405
2014...................................... 100.8270
2015...................................... 100.4135
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and at 100% on or after December 15, 2016.
The Redemption Price for Junior Subordinated Debentures, in the case of a
redemption prior to December 15, 2006 following a Tax Event or Capital Treatment
Event, as described under (ii) above, will equal the Make-Whole Amount (as
defined under "--Description of New Capital Securities--Redemption"), together
with accrued interest to but excluding the date fixed for redemption.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the date fixed for redemption to each holder of Junior
Subordinated Debentures to be redeemed at its registered address. Unless U. S.
Bancorp defaults in payment of the redemption price, on and after such
redemption date interest will cease to accrue on such Junior Subordinated
Debentures or portions thereof called for redemption.
ADDITIONAL SUMS
U. S. Bancorp has covenanted in the New Indenture that, if and for so long
as (i) the Trust is the holder of all New Junior Subordinated Debentures and
(ii) the Trust is required to pay any additional taxes, duties or other
governmental charges as a result of a Tax Event, U. S. Bancorp will pay as
additional sums on the New Junior Subordinated Debentures such amounts as may be
required so that the Distributions payable by the Trust will not be reduced as a
result of any such additional taxes, duties or other governmental charges. See
"--Description of New Capital Securities--Redemption."
In the Expense Agreement, U. S. Bancorp, as the holder of the Common
Securities, has agreed to pay all debts and other obligations (other than with
respect to the Capital Securities) and all costs and expenses of the Trust
(including costs and expenses relating to the organization and operation of the
Trust and the fees and expenses of the Issuer Trustees).
RIGHT TO SHORTEN MATURITY
If a Tax Event occurs which relates to the deductibility of interest
payable by U. S. Bancorp on the Junior Subordinated Debentures, and if the
opinion relating to such Tax Event and referred to in the definition of Tax
Event above states that the risk of non-deductibility would be avoided if the
maturity of the Junior Subordinated Debentures were shortened, U. S. Bancorp
shall have the right to shorten the maturity of the Junior Subordinated
Debentures by the amount stated in such opinion to be the minimum extent
required in order to avoid such risk, but in no event may U. S. Bancorp shorten
the maturity of the Junior Subordinated Debentures to a Stated Maturity earlier
than June 24, 2016. In such event, the Capital Securities would be redeemed as
of such earlier Stated Maturity of the Junior Subordinated Debentures. In
addition, upon the exercise of the right to shorten the maturity of the Junior
Subordinated Debentures, U. S. Bancorp will no longer have the right to redeem
the Junior Subordinated Debentures prior to the new Stated Maturity upon the
occurrence of a Tax Event or to further shorten the maturity of the Junior
Subordinated Debentures.
RESTRICTIONS ON CERTAIN PAYMENTS; CERTAIN COVENANTS OF U. S. BANCORP
U. S. Bancorp will also covenant that it will not, and will not permit any
subsidiary of U. S. Bancorp to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of U. S. Bancorp's capital stock, (ii) make any payment of
principal, interest or premium, if any, on or repay or repurchase or redeem any
debt securities of U. S. Bancorp that rank pari passu with or junior in interest
to the Junior Subordinated Debentures or (iii) make any guarantee payments with
respect to any guarantee by U. S. Bancorp of the debt securities of any
subsidiary of U. S. Bancorp if such guarantee ranks pari passu with or junior in
interest to the Junior Subordinated Debentures (other than (a) dividends or
distributions in capital stock of U. S. Bancorp, (b) any declaration of a
dividend in connection with the implementation or amendment
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of a shareholders' rights plan or any successor thereto or the issuance of
rights, stock or other property thereunder or the redemption or repurchase of
any such rights pursuant thereto, (c) payments under the Guarantee and (d)
repurchases, redemptions or other acquisitions of common stock of U. S. Bancorp
in connection with any employment contract, benefit plan or similar arrangement
with or for the benefit of any one or more employees, officers, directors or
consultants, in connection with a dividend reinvestment and stock purchase plan,
or in connection with the issuance of common stock (or securities convertible
into or exchangeable for common stock) as consideration in an acquisition
transaction entered into prior to an Extension Period) if at such time (i) there
has occurred any event of which U. S. Bancorp has actual knowledge (a) that with
the giving of notice or the lapse of time, or both, would constitute a
"Debenture Event of Default" under the Indenture and (b) in respect of which U.
S. Bancorp has not taken reasonable steps to cure, (ii) if the Junior
Subordinated Debentures are held by the Trust, U. S. Bancorp is in default with
respect to its payment of any obligations under the Guarantee or (iii) U. S.
Bancorp has given notice of its election of an Extension Period as provided in
the Indenture and shall not have rescinded such notice, or such Extension
Period, or any extension thereof, is continuing.
U. S. Bancorp has covenanted in the Indenture (i) to maintain directly or
indirectly 100% ownership of the Common Securities, provided that certain
successors that are permitted pursuant to the Indenture may succeed to U. S.
Bancorp's ownership of the Common Securities, (ii) not to voluntarily terminate,
wind-up or liquidate the Trust, other than (a) in connection with a distribution
of the Junior Subordinated Debentures to the holders of the Capital Securities
in exchange therefor upon liquidation of the Trust, or (b) in connection with
certain mergers, consolidations or amalgamations permitted by the Trust
Agreement, in either such case upon prior approval of the Federal Reserve if
then so required under applicable capital guidelines or policies of the Federal
Reserve, and (iii) to use its reasonable efforts, consistent with the terms and
provisions of the Trust Agreement, to cause the Trust to remain classified as a
grantor trust and not as an association taxable as a corporation for United
States federal income tax purposes.
MODIFICATION OF INDENTURE
From time to time U. S. Bancorp and the Debenture Trustee may, without the
consent of the holders of Junior Subordinated Debentures, amend, waive or
supplement the Indenture for specified purposes, including, among other things,
curing ambiguities, defects or inconsistencies (provided that any such action
does not materially adversely affect the interest of the holders of the Junior
Subordinated Debentures or the holders of the Capital Securities so long as they
remain outstanding) and qualifying, or maintaining the qualification of, the
Indenture under the Trust Indenture Act. The Indenture contains provisions
permitting U. S. Bancorp and the Debenture Trustee, with the consent of the
holders of not less than a majority in principal amount of the Junior
Subordinated Debentures affected, to modify the Indenture in a manner adversely
affecting the rights of the holders of the Junior Subordinated Debentures in any
material respect; provided that no such modification may, without the consent of
the holder of each outstanding Junior Subordinated Debenture so affected, (i)
change the Stated Maturity of the Junior Subordinated Debentures, or reduce the
principal amount thereof, the rate of interest thereon or any premium payable
upon redemption thereof, or change the place of payment where, or the currency
in which, any such amount is payable or impair the right to institute suit for
the enforcement of any Junior Subordinated Debenture or (ii) reduce the
percentage of principal amount of Junior Subordinated Debentures, the holders of
which are required to consent to any such modification of the Indenture, and
provided further that, so long as Capital Securities remain outstanding, (a) no
such modification may be made that adversely affects the holders of such Capital
Securities in any material respect, and no termination of the Indenture may
occur, and no waiver of any Debenture Event of Default or compliance with any
covenant under the Indenture may be effective, without the prior consent of the
holders of at least a majority of the aggregate Liquidation Amount of all
outstanding
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Capital Securities affected unless and until the principal of the Junior
Subordinated Debentures and all accrued and unpaid interest thereon have been
paid in full and certain other conditions have been satisfied, and (b) where a
consent under the Indenture would require the consent of each holder of Junior
Subordinated Debentures, no such consent shall be given by the Property Trustee
without the prior consent of each holder of Capital Securities.
DEBENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to the Junior Subordinated Debentures that has occurred and
is continuing constitutes a "Debenture Event of Default" with respect to the
Junior Subordinated Debentures:
(i) Failure for 30 days to pay any interest on the Junior Subordinated
Debentures when due (subject to the deferral of any interest payment in
the case of an Extension Period); or
(ii) Failure to pay any principal or premium, if any, on the Junior
Subordinated Debentures when due whether at maturity or upon redemption;
or
(iii) Failure to observe or perform in any material respect certain other
covenants contained in the Indenture for 90 days after written notice to
U. S. Bancorp from the Debenture Trustee or the holders of at least 25% in
aggregate outstanding principal amount of Old Junior Subordinated
Debentures or New Junior Subordinated Debentures, as applicable; or
(iv) Certain events in bankruptcy, insolvency or reorganization of U. S.
Bancorp.
The holders of at least a majority in aggregate outstanding principal
amount of the Old Junior Subordinated Debentures or New Junior Subordinated
Debentures, as applicable, have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Debenture Trustee.
The Debenture Trustee or the holders of not less than 25% in aggregate
outstanding principal amount of the Old Junior Subordinated Debentures or the
New Junior Subordinated Debentures, as applicable, may declare the principal due
and payable immediately upon a Debenture Event of Default, and, if the Debenture
Trustee or such holders of the Old Junior Subordinated Debentures or the New
Junior Subordinated Debentures, as applicable, fail to make such declaration,
the holders of at least 25% in aggregate Liquidation Amount of the Old Capital
Securities or the New Capital Securities, as applicable, will have such right.
The holders of at least a majority in aggregate outstanding principal amount of
the Old Junior Subordinated Debentures or the New Junior Subordinated
Debentures, as applicable, may annul such declaration and waive the default if
all defaults (other than the non-payment of the principal of the Old Junior
Subordinated Debentures or the New Junior Subordinated Debentures, as
applicable, which has become due solely by such acceleration) have been cured
and a sum sufficient to pay all matured installments of interest and principal
due otherwise than by acceleration has been deposited with the Debenture
Trustee. If the holders of the Old Junior Subordinated Debentures or the New
Junior Subordinated Debentures, as applicable, fail to annul such declaration
and waive such default, the holders of a majority in aggregate Liquidation
Amount of the Old Capital Securities or New Capital Securities, as applicable,
will have such right.
The holders of at least a majority in aggregate outstanding principal
amount of the Old Junior Subordinated Debentures or the New Junior Subordinated
Debentures, as applicable, may, on behalf of the holders of all the Old Junior
Subordinated Debentures or the New Junior Subordinated Debentures, as
applicable, waive any default, except a default in the payment of principal or
interest (unless such default has been cured and a sum sufficient to pay all
matured installments of interest and principal due otherwise than by
acceleration has been deposited with the Debenture Trustee) or a default in
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respect of a covenant or provision which under the Indenture cannot be modified
or amended without the consent of the holder of each outstanding Old Junior
Subordinated Debenture or New Junior Subordinated Debenture, as applicable. If
the holders of the Old Junior Subordinated Debentures or the New Junior
Subordinated Debentures, as applicable, fail to waive such default, the holders
of a majority in aggregate Liquidation Amount of the Old Capital Securities or
the New Capital Securities, as applicable, will have such right. U. S. Bancorp
is required to file annually with the Debenture Trustee certificates as to
whether or not U. S. Bancorp is in compliance with all the conditions and
covenants applicable to it under the Indenture.
If a Debenture Event of Default has occurred and is continuing, the
Property Trustee will have the right to declare the principal of and the
interest on the Old Junior Subordinated Debentures or the New Junior
Subordinated Debentures, as applicable, and any other applicable amounts payable
under the Indenture, to be forthwith due and payable and to enforce its other
rights as a creditor with respect to the Old Junior Subordinated Debentures or
the New Junior Subordinated Debentures, as applicable.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF NEW CAPITAL SECURITIES
If a Debenture Event of Default has occurred and is continuing and such
event is attributable to the failure of U. S. Bancorp to pay any amounts payable
in respect of the New Junior Subordinated Debentures on the date such amounts
are otherwise payable, a holder of New Capital Securities may institute a legal
proceeding directly against U. S. Bancorp for enforcement of payment to such
holder of an amount equal to the amount payable in respect of such New Junior
Subordinated Debentures having a principal amount equal to the aggregate
Liquidation Amount of the New Capital Securities held by such holder (a "Direct
Action"). U. S. Bancorp may not amend the New Indenture to remove the foregoing
right to bring a Direct Action without the prior written consent of the holders
of all of the New Capital Securities outstanding. U. S. Bancorp will have the
right under the New Indenture to set off any payment made to such holder of New
Capital Securities by U. S. Bancorp in connection with a Direct Action.
The holders of the New Capital Securities will not be able to exercise
directly any remedies, other than those set forth in the preceding paragraph,
available to the holders of the New Junior Subordinated Debentures. See
"--Description of New Capital Securities--Events of Default; Notice."
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Indenture provides that U. S. Bancorp shall not consolidate with or
merge into any other Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, and no Person shall
consolidate with or merge into U. S. Bancorp or convey, transfer or lease its
properties and assets substantially as an entirety to U. S. Bancorp, unless (i)
in case U. S. Bancorp consolidates with or merges into another Person or conveys
or transfers its properties and assets substantially as an entirety to any
Person, the successor Person is organized under the laws of the United States or
any state or the District of Columbia, and such successor Person expressly
assumes U. S. Bancorp's obligations on the Junior Subordinated Debentures; (ii)
immediately after giving effect thereto, no Debenture Event of Default, and no
event which, after notice or lapse of time or both, would become a Debenture
Event of Default, shall have occurred and be continuing; (iii) such transaction
is permitted under the Trust Agreement and Guarantee and does not give rise to
any breach or violation of the Trust Agreement or Guarantee, and (iv) certain
other conditions as prescribed by the Indenture are met. It is anticipated that
FBS will become the successor to U. S. Bancorp pursuant to the Indenture, the
Trust Agreement, the Guarantee and the Expense Agreement pursuant to the
foregoing provisions in the event that the contemplated merger of U. S. Bancorp
with and into FBS is consummated. See "U. S. Bancorp."
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The general provisions of the Indenture do not afford holders of the
Junior Subordinated Debentures protection in the event of a highly leveraged or
other transaction involving U. S. Bancorp that may adversely affect holders of
the Junior Subordinated Debentures.
SATISFACTION AND DISCHARGE
The New Indenture provides that when, among other things, all New Junior
Subordinated Debentures not previously delivered to the Debenture Trustee for
cancellation (i) have become due and payable or (ii) will become due and payable
at their Stated Maturity within one year, and U. S. Bancorp deposits or causes
to be deposited with the Debenture Trustee funds, in trust, for the purpose and
in an amount sufficient to pay and discharge the entire indebtedness on the New
Junior Subordinated Debentures not previously delivered to the Debenture Trustee
for cancellation, for the principal (and premium, if any) and interest and
Additional Sums to the date of the deposit or to the Stated Maturity, as the
case may be, then the New Indenture will cease to be of further effect (except
as to U. S. Bancorp's obligations to pay all other sums due pursuant to the New
Indenture and to provide the officers' certificates and opinions of counsel
described therein), and U. S. Bancorp will be deemed to have satisfied and
discharged the New Indenture.
SUBORDINATION
In the Indenture, U. S. Bancorp has covenanted and agreed that the Junior
Subordinated Debentures issued thereunder will rank subordinate and junior in
right of payment to all Senior Debt of U. S. Bancorp to the extent provided in
the Indenture. Upon any payment or distribution of assets of U. S. Bancorp to
creditors upon any liquidation, dissolution, winding up, reorganization,
assignment for the benefit of creditors, marshaling of assets or any bankruptcy,
insolvency, debt restructuring or similar proceedings in connection with any
insolvency or bankruptcy proceeding of U. S. Bancorp, the holders of Senior Debt
will first be entitled to receive payment in full of principal of (and premium,
if any) and interest, if any, on such Senior Debt before the holders of Junior
Subordinated Debentures or the Property Trustee, on behalf of the holders of
Trust Securities, will be entitled to receive or retain any payment in respect
of the principal of (and premium, if any) and interest, if any, on the Junior
Subordinated Debentures; provided, however, that holders of Senior Debt will not
be entitled to receive payment of any such amount to the extent that such
holders would be required by the subordination provisions of such Senior Debt to
pay such amounts over to the obligees on trade accounts payable or other
liabilities arising in the ordinary course of U. S. Bancorp's business.
In the event of the acceleration of the maturity of the Junior
Subordinated Debentures, the holders of all Senior Debt outstanding at the time
of such acceleration will first be entitled to receive payment in full of all
amounts due thereon (including any amounts due upon acceleration) before the
holders of Junior Subordinated Debentures will be entitled to receive or retain
any payment in respect of the principal of (or premium, if any) or interest, if
any, on the Junior Subordinated Debentures; provided, however, that holders of
Senior Debt shall not be entitled to receive payment of any such amounts to the
extent that such holders would be required by the subordination provisions of
such Senior Debt to pay such amounts over to the obligees on trade accounts
payable or other liabilities arising in the ordinary course of U. S.
Bancorp's business.
No payments on account of principal (or premium, if any) or interest in
respect of the Junior Subordinated Debentures may be made if there shall have
occurred and be continuing a default in any payment with respect to Senior Debt
or an event of default with respect to any Senior Debt resulting in the
acceleration of the maturity thereof, or if any judicial proceeding shall be
pending with respect to any such default.
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"Senior Debt" means (i) Senior Indebtedness (but excluding trade accounts
payable and accrued liabilities arising in the ordinary course of business) and
(ii) the Allocable Amounts of Senior Subordinated Indebtedness.
"Senior Indebtedness" means the principal of (and premium, if any) and
unpaid interest on (i) every obligation of U. S. Bancorp for money borrowed
(including any deferred obligation for the payment of the purchase price of
property and assets and obligations arising from guarantees by U. S. Bancorp of
the indebtedness of others), (ii) obligations of, or any such obligation
guaranteed by, U. S. Bancorp as lessee under leases required to be capitalized
on the balance sheet of the lessee under generally accepted accounting
principles and leases of property or assets made as part of any sale and
leaseback transaction to which U. S. Bancorp is a party, (iii) obligations of U.
S. Bancorp under letters of credit, and (iv) any indebtedness of U. S. Bancorp
under or other obligations of U. S. Bancorp to make payment pursuant to the
terms of commodity contracts, interest rate and currency swap agreements, cap,
floor and collar agreements, currency spot and forward contracts, and other
similar agreements or arrangements, whether incurred on or prior to the date of
the Indenture or thereafter incurred, other than any obligation as to which, in
the instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such obligation is not Senior Indebtedness,
provided that Senior Indebtedness does not include Senior Subordinated
Indebtedness or the Junior Subordinated Debentures.
"Senior Subordinated Indebtedness" means any obligation of U. S. Bancorp
to its creditors, whether now outstanding or subsequently incurred, where the
instrument creating or evidencing the obligation or pursuant to which the
obligation is outstanding provides that it is subordinate and junior in right of
payment to Senior Indebtedness. Senior Subordinated Indebtedness includes U. S.
Bancorp's outstanding subordinated debt securities and any subordinated debt
securities issued in the future with substantially similar subordination terms
and does not include the Junior Subordinated Debentures or any subordinated debt
securities issued in the future with subordination terms substantially similar
to the Junior Subordinated Debentures.
"Allocable Amounts," when used with respect to any Senior Subordinated
Indebtedness, means the amount necessary to pay all principal of (and premium,
if any) and interest, if any, on such Senior Subordinated Indebtedness in full
less, if applicable, any portion of such amounts which would have been paid to,
and retained by, the holders of such Senior Subordinated Indebtedness (whether
as a result of the receipt of payments by the holders of such Senior
Subordinated Indebtedness from U. S. Bancorp or any other obligor thereon or
from any holders of, or trustee in respect of, other indebtedness that is
subordinate and junior in right of payment to such Senior Subordinated
Indebtedness pursuant to any provision of such indebtedness for the payment over
of amounts received on account of such indebtedness to the holders of such
Senior Subordinated Indebtedness) but for the fact that such Senior Subordinated
Indebtedness is subordinate or junior in right of payment to trade accounts
payable or accrued liabilities arising in the ordinary course of business.
The Indenture places no limitation on the amount of Senior Debt that may
be incurred by U. S. Bancorp. U. S. Bancorp expects from time to time to incur
additional indebtedness and other obligations constituting Senior Debt.
GOVERNING LAW
The New Indenture and the New Junior Subordinated Debentures will be
governed by and construed in accordance with the laws of the State of New York.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
Following the Exchange Offer and the qualification of the New Indenture
under the Trust Indenture Act, the Debenture Trustee shall have and be subject
to all the duties and responsibilities specified with respect to an indenture
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trustee under the Trust Indenture Act. Subject to such provisions, the Debenture
Trustee is under no obligation to exercise any of the powers vested in it by the
New Indenture at the request of any holder of New Junior Subordinated
Debentures, unless offered reasonable indemnity by such holder against the
costs, expenses and liabilities which might be incurred thereby. The Debenture
Trustee is not required to expend or risk its own funds or otherwise incur
personal financial liability in the performance of its duties if the Debenture
Trustee reasonably believes that repayment or adequate indemnity is not
reasonably assured to it.
The Debenture Trustee presently serves as trustee with respect to the Old
Junior Subordinated Debentures, as well as Floating Rate Notes due November 15,
2006, issued by U. S. Bancorp pursuant to an indenture dated November 19, 1996
and related Floating Rate Putable Asset Trust Securities due November 15, 1999
issued pursuant to a Trust Agreement dated as of November 14, 1996, between U.
S. Bancorp and The First National Bank of Chicago, as trustee. The Debenture
Trustee also serves as issuing and paying agent for bank notes issued by
national banking subsidiaries of U. S. Bancorp and may serve from time to time
as trustee or paying agent under other indentures, trust agreements or issuing
and paying agency agreements with U. S. Bancorp or its subsidiaries relating to
other issues of their securities. U. S. Bancorp and its subsidiaries maintain
deposit accounts and conduct other banking transactions with the Debenture
Trustee in the ordinary course of business.
DESCRIPTION OF NEW GUARANTEE
The Old Guarantee was executed and delivered by U. S. Bancorp concurrently
with the issuance by the Trust of the Old Capital Securities for the benefit of
the holders from time to time of the Old Capital Securities. Promptly after the
Expiration Date, the New Guarantee will be issued by U. S. Bancorp for the
benefit of the holders from time to time of the New Capital Securities. The New
Guarantee has been qualified under the Trust Indenture Act. This summary of
certain provisions of the New Guarantee does not purport to be complete and is
subject to, and qualified in its entirety by reference to, all of the provisions
of the New Guarantee, including the definitions therein of certain terms, and
the Trust Indenture Act.
GENERAL
U. S. Bancorp will irrevocably agree to pay in full on a subordinated
basis, to the extent set forth herein, the Guarantee Payments (as defined below)
to the holders of the New Capital Securities, as and when due, regardless of any
defense, right of set-off or counterclaim that the Trust may have or assert
other than the defense of payment. The following payments with respect to the
New Capital Securities, to the extent not paid by or on behalf of the Trust (the
"Guarantee Payments"), will be subject to the New Guarantee: (i) any accumulated
and unpaid Distributions required to be paid on the New Capital Securities, to
the extent that the Trust has funds on hand available therefor at such time,
(ii) the Redemption Price with respect to New Capital Securities called for
redemption, to the extent that the Trust has funds on hand available therefor at
such time, and (iii) upon a voluntary or involuntary termination, winding-up or
liquidation of the Trust (unless the New Junior Subordinated Debentures are
distributed to holders of the New Capital Securities in exchange therefor), the
lesser of (a) the aggregate of the Liquidation Amount and all accumulated and
unpaid Distributions to the date of payment, to the extent that the Trust has
funds on hand available therefor at that time, and (b) the amount of assets of
the Trust remaining available for distribution to holders of New Capital
Securities after satisfaction of liabilities to creditors of the Trust as
required by applicable law. U. S. Bancorp's obligation to make a Guarantee
Payment may be satisfied by direct payment of the required amounts by U. S.
Bancorp to the holders of the New Capital Securities or by causing the Trust to
pay such amounts to such holders.
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The New Guarantee will be an irrevocable guarantee on a subordinated basis
of the Trust's obligations under the New Capital Securities, but will apply only
to the extent that the Trust has funds sufficient to make such payments, and is
not a guarantee of collection.
If U. S. Bancorp does not make interest payments on the New Junior
Subordinated Debentures held by the Trust, the Trust will not be able to pay
Distributions on the New Capital Securities and will not have funds available
therefor and, in such event, holders of the New Capital Securities would not be
able to rely upon the New Guarantee for payment of such amounts. Instead, if any
Debenture Event of Default under the New Indenture has occurred and is
continuing, then a holder of New Capital Securities may institute a Direct
Action against U. S. Bancorp pursuant to the terms of the New Indenture for
enforcement of payment to such holder of the principal of or interest or
premium, if any, on such New Junior Subordinated Debentures having a principal
amount equal to the aggregate Liquidation Amount of the New Capital Securities
of such holder. In connection with such Direct Action, U. S. Bancorp will have a
right of set-off under the New Indenture to the extent of any payment made by U.
S. Bancorp to such holder of New Capital Securities in the Direct Action. Except
as described herein, holders of New Capital Securities will not be able to
exercise directly any other remedy available to the holders of the New Junior
Subordinated Debentures or assert directly any other rights in respect of the
New Junior Subordinated Debentures.
The New Guarantee will rank subordinate and junior in right of payment to
all Senior Debt of U. S. Bancorp. See "--Status of the New Guarantee." Because
U. S. Bancorp is a holding company, its rights and the rights of its creditors
to participate in any distribution of assets of any subsidiary upon the latter's
liquidation or reorganization or otherwise is subject to the prior claims of
creditors of that subsidiary (including depositors in the case of bank
subsidiaries), except to the extent that U. S. Bancorp may itself be a creditor
with recognized claims against that subsidiary. There are also various legal
limitations on the extent to which certain of U. S. Bancorp's subsidiaries may
extend credit, pay dividends or otherwise supply funds to U. S. Bancorp or
certain of its subsidiaries. See "Certain Regulatory Considerations."
Accordingly, U. S. Bancorp's obligations under the New Guarantee will be
effectively subordinated and junior to all existing and future liabilities of U.
S. Bancorp's subsidiaries, and claimants under the New Guarantee should look
only to the assets of U. S. Bancorp for payments thereunder. The New Guarantee
does not limit the incurrence or issuance of other secured or unsecured debt of
U. S. Bancorp, including Senior Debt, whether under any other existing indenture
or any other indenture that U. S. Bancorp may enter into in the future or
otherwise. U. S. Bancorp expects from time to time to incur additional
indebtedness constituting Senior Debt.
U. S. Bancorp will, through the New Guarantee, the Trust Agreement, the
New Junior Subordinated Debentures, the New Indenture and the Expense Agreement,
taken together, fully, irrevocably and unconditionally guarantee all of the
Trust's obligations under the New Capital Securities. No single document
standing alone or operating in conjunction with fewer than all of the other
documents constitutes such guarantee. It is only the combined operation of these
documents that has the effect of providing a full, irrevocable and unconditional
guarantee of the Trust's obligations under the New Capital Securities. See
"Relationship Among the New Capital Securities, the New Junior Subordinated
Debentures, the New Guarantee, and the Expense Agreement."
STATUS OF NEW GUARANTEE
The New Guarantee will constitute an unsecured obligation of U. S. Bancorp
and will rank subordinate and junior in right of payment to all Senior Debt of
U. S. Bancorp in the same manner as the New Junior Subordinated Debentures,
except in the case of a bankruptcy or insolvency proceeding in respect of U. S.
Bancorp, in which case the New Guarantee will rank subordinate and junior in
right of payment to all liabilities of U. S. Bancorp.
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The New Guarantee will rank pari passu with the Old Guarantee. The New
Guarantee will constitute a guarantee of payment and not of collection (i.e.,
the guaranteed party may institute a legal proceeding directly against U. S.
Bancorp to enforce its rights under the New Guarantee without first instituting
a legal proceeding against any other person or entity). The New Guarantee will
be held by the Guarantee Trustee for the benefit of the holders of the New
Capital Securities. The New Guarantee will not be discharged except by payment
of the Guarantee Payments in full to the extent not paid by the Trust or upon
distribution to the holders of the New Capital Securities of the New Junior
Subordinated Debentures.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not materially adversely
affect the rights of holders of the New Capital Securities (in which case no
vote will be required), the New Guarantee may not be amended without the prior
approval of the holders of not less than a majority of the aggregate Liquidation
Amount of the outstanding New Capital Securities. The manner of obtaining any
such approval will be as set forth under "--Description of New Capital
Securities--Voting Rights; Amendment of the Trust Agreement." All guarantees and
agreements contained in the New Guarantee will bind the successors, assigns,
receivers, trustees and representatives of U. S. Bancorp and will inure to the
benefit of the holders of the New Capital Securities then outstanding.
EVENTS OF DEFAULT
An event of default under the New Guarantee will occur upon the failure of
U. S. Bancorp to perform any of its payment obligations thereunder, or to
perform any non-payment obligation if such non-payment default remains
unremedied for 30 days. The holders of not less than a majority in aggregate
Liquidation Amount of the Capital Securities will have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Guarantee Trustee in respect of the New Guarantee or to direct the exercise
of any trust power conferred upon the Guarantee Trustee under the New Guarantee.
Any registered holder of the New Capital Securities may institute a legal
proceeding directly against U. S. Bancorp to enforce its rights under the New
Guarantee without first instituting a legal proceeding against the Trust, the
Guarantee Trustee or any other person or entity.
U. S. Bancorp, as guarantor, is required to file annually with the
Guarantee Trustee a certificate as to whether or not U. S. Bancorp is in
compliance with all the conditions and covenants applicable to it under the New
Guarantee.
TERMINATION OF THE NEW GUARANTEE
The New Guarantee will terminate and be of no further force and effect
upon full payment of the Redemption Price of the New Capital Securities, upon
full payment of the amounts payable upon liquidation of the Trust or upon
distribution of New Junior Subordinated Debentures to the holders of the New
Capital Securities in exchange therefor. The New Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any holder
of the New Capital Securities must restore payment of any sums paid under such
New Capital Securities or the New Guarantee.
GOVERNING LAW
The New Guarantee will be governed by and construed in accordance with the
laws of the State of New York.
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INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance of
a default by U. S. Bancorp in performance of the New Guarantee, will undertake
to perform only such duties as are specifically set forth in the Guarantee and,
after default with respect to the New Guarantee, must exercise the same degree
of care and skill as a prudent person would exercise or use in the conduct of
his or her own affairs. Subject to this provision, the Guarantee Trustee will be
under no obligation to exercise any of the powers vested in it by the New
Guarantee at the request of any holder of New Capital Securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
might be incurred thereby.
For information concerning the relationship between The First National
Bank of Chicago, the Guarantee Trustee, and U. S. Bancorp, see "--Description of
New Junior Subordinated Debentures--Information Concerning the Debenture
Trustee."
THE EXPENSE AGREEMENT
Pursuant to an Agreement as to Expenses and Liabilities entered into by U.
S. Bancorp under the Trust Agreement (the "Expense Agreement"), U. S. Bancorp
will, as holder of the Common Securities, irrevocably and unconditionally
guarantee to each Person to whom the Trust becomes indebted or liable, the full
payment of any costs, expenses or liabilities of the Trust, other than
obligations of the Trust to pay to the holders of the Trust Securities of the
amounts due such holders pursuant to the terms of the Trust Securities. The
Expense Agreement will be enforceable by third parties, will constitute an
unsecured obligation of U. S. Bancorp and will rank subordinate and junior in
right of payment to all Senior Debt of U. S. Bancorp in the same manner as the
Guarantee and the Junior Subordinated Debentures.
DESCRIPTION OF OLD SECURITIES
The terms of the Old Securities are identical in all material respects to
the New Securities, except that (i) the Old Securities have not been registered
under the Securities Act, are subject to certain restrictions on transfer and
are entitled to certain rights under the Registration Rights Agreement (which
rights will terminate upon consummation of the Exchange Offer, except under
limited circumstances), (ii) the New Capital Securities will not contain certain
restrictions on transfer applicable to Old Capital Securities, and (iii) the New
Capital Securities will not provide for any increase in the Distribution rate
thereon and the New Junior Subordinated Debentures will not provide for any
increase in the interest rate thereon, in each case in connection with the
Exchange Offer. With respect to clause (iii) above, in the event that a
registration statement relating to an exchange offer had not been filed and
declared effective by specified dates, or, in certain limited circumstances, in
the event a shelf registration statement (the "Shelf Registration Statement")
with respect to the resale of the Old Capital Securities was not declared
effective by a specified date, then interest would have accrued (in addition to
the stated interest rate on the Old Junior Subordinated Debentures) at the rate
of 0.25% per annum on the principal amount of the Old Junior Subordinated
Debentures and Distributions would have accumulated (in addition to the stated
Distribution rate on the Old Capital Securities) at the rate of 0.25% per annum
on the Liquidation Amount of the Old Capital Securities, for the period from the
occurrence of such event until such time as such required exchange offer was
consummated or any required Shelf Registration Statement became effective. The
New Securities are not, and upon consummation of the Exchange Offer the Old
Securities will not be, entitled to any such additional interest or
Distributions or any further registration rights, except under limited
circumstances. Accordingly, holders of Old Capital Securities should review the
information set forth under "Risk Factors--Certain Consequences of a Failure to
Exchange Old Capital Securities" and "Description of New Securities."
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RELATIONSHIP AMONG THE NEW CAPITAL SECURITIES, THE NEW JUNIOR
SUBORDINATED DEBENTURES, THE NEW GUARANTEE
AND THE EXPENSE AGREEMENT
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the New Capital
Securities (to the extent the Trust has funds available for the payment of such
Distributions) will be irrevocably guaranteed by U. S. Bancorp as and to the
extent set forth under "Description of New Securities--Description of New
Guarantee." Taken together, U. S. Bancorp's obligations under the New Junior
Subordinated Debentures, the New Indenture, the Trust Agreement, the Expense
Agreement, and the New Guarantee will provide, in the aggregate, a full,
irrevocable and unconditional guarantee of payments of Distributions and other
amounts due on the New Capital Securities. No single document standing alone or
operating in conjunction with fewer than all of the other documents constitutes
such guarantee. It is only the combined operation of these documents that has
the effect of providing a full, irrevocable and unconditional guarantee of the
Trust's obligations under the New Capital Securities. If and to the extent that
U. S. Bancorp does not make payment on the New Junior Subordinated Debentures,
the Trust will not pay Distributions or other amounts due on the New Capital
Securities. The New Guarantee does not cover payment of Distributions when the
Trust does not have sufficient funds to pay such Distributions. In such event,
the remedy of a holder of New Capital Securities is to institute a Direct
Action.
The obligations of U. S. Bancorp under the New Guarantee will be
subordinate and junior in right of payment to all Senior Debt of U. S. Bancorp.
SUFFICIENCY OF PAYMENTS
As long as payments of interest and other payments are made when due on
the New Junior Subordinated Debentures, such payments will be sufficient to
cover Distributions and other payments distributable on the New Capital
Securities, primarily because (i) the aggregate principal amount of the New
Junior Subordinated Debentures will be equal to the sum of the aggregate stated
Liquidation Amount of the New Capital Securities and Common Securities; (ii) the
interest rate and interest and other payment dates on the New Junior
Subordinated Debentures will match the Distribution rate and Distribution and
other payment dates for the Trust Securities; (iii) U. S. Bancorp will pay for
all and any costs, expenses and liabilities of the Trust except the Trust's
obligations to holders of Trust Securities; and (iv) the Trust Agreement further
provides that the Trust will not engage in any activity that is not consistent
with the limited purposes of the Trust.
Notwithstanding anything to the contrary in the New Indenture, U. S.
Bancorp has the right to set-off any payment it is otherwise required to make
thereunder against and to the extent U. S. Bancorp has theretofore made, or is
concurrently on the date of such payment making, a payment under the New
Guarantee.
ENFORCEMENT RIGHTS OF HOLDERS OF NEW CAPITAL SECURITIES
A holder of any New Capital Security may institute a legal proceeding
directly against U. S. Bancorp to enforce its rights under the New Guarantee
without first instituting a legal proceeding against the Guarantee Trustee, the
Trust or any other person or entity.
A default or event of default under any Senior Debt of U. S. Bancorp would
not constitute a default or Event of Default in respect of the New Capital
Securities. However, in the event of payment defaults under, or acceleration of,
Senior Debt of U. S. Bancorp, the subordination provisions of the New Indenture
provide that no payments may be made in respect of the New Junior Subordinated
Debentures until such Senior Debt has been paid in full or any payment default
thereunder has been cured or waived. Failure to make
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required payments on New Junior Subordinated Debentures would constitute an
Event of Default under the Trust Agreement.
LIMITED PURPOSE OF THE TRUST
The New Capital Securities will represent undivided beneficial ownership
interests in the Trust. The Trust exists for the sole purpose of issuing and
selling the Trust Securities and investing the proceeds thereof in Junior
Subordinated Debentures. A principal difference between the rights of a holder
of a New Capital Security and a holder of a New Junior Subordinated Debenture is
that a holder of a New Junior Subordinated Debenture will be entitled to receive
from U. S. Bancorp the principal amount of and interest accrued on New Junior
Subordinated Debentures held, while a holder of New Capital Securities is
entitled to receive Distributions from the Trust (or from U. S. Bancorp under
the New Guarantee) only if and to the extent the Trust has funds available for
the payment of such Distributions.
RIGHTS UPON TERMINATION
Upon any voluntary or involuntary termination, winding-up or liquidation
of the Trust, other than any such termination, winding-up or liquidation
involving the distribution of the Junior Subordinated Debentures, after
satisfaction of liabilities to creditors of the Trust as required by applicable
law and subject to the Expense Agreement, the holders of the Trust Securities
will be entitled to receive, out of the assets held by the Trust, the
Liquidation Distribution in cash. See "Description of New
Securities--Description of New Capital Securities--Liquidation Distribution Upon
Termination." Upon any voluntary or involuntary liquidation or bankruptcy of U.
S. Bancorp, the Property Trustee, as holder of the New Junior Subordinated
Debentures, would be a subordinated creditor of U. S. Bancorp, subordinated in
right of payment to all Senior Debt as set forth in the New Indenture, but
entitled to receive payment in full of principal and interest, before any
shareholders of U. S. Bancorp receive payments or distributions. Since U. S.
Bancorp will be the guarantor under the New Guarantee and has agreed to pay for
all costs, expenses and liabilities of the Trust (other than the Trust's
obligations to the holders of the Trust Securities) under the Expense Agreement,
the positions of a holder of New Capital Securities and a holder of New Junior
Subordinated Debentures relative to other creditors and to shareholders of U. S.
Bancorp in the event of liquidation or bankruptcy of U. S. Bancorp are expected
to be substantially the same.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the principal United States federal income
tax consequences of the purchase, ownership and disposition of Capital
Securities. This summary only addresses the tax consequences to a person that
acquired the Old Capital Securities upon initial issuance at their original
offering price and that is (i) an individual citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of the
United States or any state thereof or the District of Columbia or (iii) an
estate or trust the income of which is subject to United States federal income
tax regardless of source (a "United States Person"). This summary does not
address all tax consequences that may be applicable to a United States Person
that is a beneficial owner of Capital Securities, nor does it address the tax
consequences to (i) persons that are not United States Persons, (ii) persons
that may be subject to special treatment under United States federal income tax
law, such as banks, insurance companies, thrift institutions, regulated
investment companies, real estate investment trusts, tax-exempt organizations
and dealers in securities or currencies, (iii) persons that will hold Capital
Securities as part of a position in a "straddle" or as part of a "hedging,"
"conversion" or other integrated investment transaction for federal income tax
purposes, (iv) persons whose functional currency is not the United States dollar
or (v) persons that do not hold Capital Securities as capital assets.
The statements of law or legal conclusion set forth in this summary
constitute the opinion of Miller, Nash, Wiener, Hager & Carlsen LLP, counsel
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to U. S. Bancorp and the Trust ("Tax Counsel"). This summary is based upon the
Internal Revenue Code (the "Code"), Treasury Regulations, rulings of the
Internal Revenue Service (the "IRS") and pronouncements and judicial decisions
now in effect, all of which are subject to change at any time. Such changes may
be applied retroactively in a manner that could cause the tax consequences to
vary substantially from the consequences described below, possibly adversely
affecting a beneficial owner of Capital Securities. In particular, legislation
has been proposed that could adversely affect U. S. Bancorp's ability to deduct
interest on the Junior Subordinated Debentures, which may in turn permit U. S.
Bancorp to cause a redemption of the Capital Securities. See "--Proposed Tax
Legislation." The authorities on which this summary is based are subject to
various interpretations, and it is therefore possible that the federal income
tax treatment of the purchase, ownership and disposition of Capital Securities
may differ from the treatment described below.
EXCHANGE OF CAPITAL SECURITIES
The exchange of Old Capital Securities for New Capital Securities should
not be a taxable event to holders for United States federal income tax purposes.
The exchange of Old Capital Securities for New Capital Securities pursuant to
the Exchange Offer should not be treated as an "exchange" for United States
federal income tax purposes because the New Capital Securities should not be
considered to differ materially in kind or extent from the Old Capital
Securities and because the exchange will occur by operation of the terms of the
Old Capital Securities. If, however, the exchange of the Old Capital Securities
for the New Capital Securities were treated as an exchange for United States
federal income tax purposes, such exchange should constitute a recapitalization
for United States federal income tax purposes. Accordingly, the New Capital
Securities should have the same issue price as the Old Capital Securities, and a
holder should have the same adjusted tax basis and holding period in the New
Capital Securities as the holder had in the Old Capital Securities immediately
before the exchange.
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES
In connection with the issuance of the Old Junior Subordinated Debentures,
Tax Counsel has rendered its opinion generally to the effect that, under then
current law and assuming full compliance with the terms of the Old Indenture
(and certain other documents), and based on certain facts and assumptions
contained in such opinion, the Old Junior Subordinated Debentures will be
classified for United States federal income tax purposes as indebtedness of U.
S. Bancorp. An opinion of Tax Counsel, however, is not binding on the IRS or the
courts. No rulings have been or are expected to be sought from the IRS with
respect to any of these issues and no assurance can be given that the IRS will
not take contrary positions. Moreover, no assurance can be given that any of the
opinions expressed herein will not be challenged by the IRS or, if challenged,
that such a challenge would not be successful.
CLASSIFICATION OF THE TRUST
In connection with the issuance of the Old Capital Securities, Tax Counsel
has rendered its opinion generally to the effect that, under then current law
and assuming full compliance with the terms of the Trust Agreement and the Old
Indenture (and certain other documents), and based on certain facts and
assumptions contained in such opinion, the Trust will be classified for United
States federal income tax purposes as a grantor trust and not as an association
taxable as a corporation. Accordingly, for United States federal income tax
purposes, each beneficial owner of Capital Securities (a "Securityholder")
generally will be considered the owner of an undivided interest in the Junior
Subordinated Debentures, and each holder will be required to include in its
gross income any interest (or original issue discount accrued) with respect to
its allocable share of those Junior Subordinated Debentures.
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INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under recently issued Treasury regulations applicable to debt instruments
issued on or after August 13, 1996 (the "Regulations"), a "remote" contingency
that stated interest will not be timely paid will be ignored in determining
whether a debt instrument is issued with original issue discount ("OID"). U. S.
Bancorp believes that the likelihood of its exercising its option to defer
interest payments is remote. Accordingly, U. S. Bancorp intends to take the
position, based on the advice of Tax Counsel, that the Junior Subordinated
Debentures will not be considered to be issued with OID and, accordingly, a
Securityholder should include in gross income such Securityholder's allocable
share of interest on the Junior Subordinated Debentures.
Under the Regulations, if U. S. Bancorp exercised its option to defer any
payment of interest, the Junior Subordinated Debentures would at that time be
treated as issued with OID, and all stated interest on the Junior Subordinated
Debentures would thereafter be treated as OID as long as Junior Subordinated
Debentures remained outstanding. In such event, all of a holder's taxable
interest income with respect to the Junior Subordinated Debentures would be
accounted for as OID on an economic accrual basis regardless of such
Securityholder's method of tax accounting, and actual distributions of stated
interest would not be reported as taxable income. Consequently, a Securityholder
would be required to include in gross income OID even though U. S. Bancorp would
not make any actual cash payments during an Extension Period.
The Regulations have not been addressed in any rulings or other
interpretations by the IRS and it is possible that the IRS could take a position
contrary to Tax Counsel's interpretation herein.
Because income on the Capital Securities will constitute interest or OID,
corporate Securityholders will not be entitled to a dividends-received deduction
with respect to any income recognized with respect to the Capital Securities.
Subsequent uses of the term "interest" in this summary include income in
the form of OID.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES OR CASH TO HOLDERS OF CAPITAL
SECURITIES
Under current law, a distribution by the Trust of the Junior Subordinated
Debentures as described under the caption "Description of New
Securities--Description of New Capital Securities--Liquidation Distribution Upon
Termination" will be non-taxable and will result in the Securityholder receiving
directly its pro rata share of the Junior Subordinated Debentures previously
held indirectly through the Trust, with a holding period and aggregate tax basis
equal to the holding period and aggregate tax basis such Securityholder had in
its Capital Securities before such distribution. If, however, the liquidation of
the Trust were to occur because the Trust is subject to United States federal
income tax with respect to income accrued or received on the Junior Subordinated
Debentures, the distribution of Junior Subordinated Debentures to
Securityholders by the Trust would be a taxable event to the Trust and each
Securityholder, and the Securityholder would recognize gain or loss as if the
Securityholder had exchanged its Capital Securities for the Junior Subordinated
Debentures it received upon the liquidation of the Trust. A Securityholder will
include interest in income in respect of Junior Subordinated Debentures received
from the Trust in the manner described above under "--Interest Income and
Original Issue Discount."
Under certain circumstances described herein (see "Description of New
Securities--Description of New Junior Subordinated Debentures--Redemption"), the
Junior Subordinated Debentures may be redeemed by U. S. Bancorp for cash and the
proceeds of such redemption distributed by the Trust to holders in redemption of
their Capital Securities. Under current law, such redemption
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would, for U.S. federal income tax purposes, constitute a taxable disposition of
the redeemed Capital Securities, and a holder could recognize gain or loss as if
it sold such redeemed Capital Securities for cash. See "--Sales or Redemption of
Capital Securities."
SALES OR REDEMPTION OF CAPITAL SECURITIES
A Securityholder that sells (including a redemption for cash) Capital
Securities will recognize gain or loss equal to the difference between its
adjusted tax basis in the Capital Securities and the amount realized on the sale
of such Capital Securities. Assuming that U. S. Bancorp does not exercise its
option to defer payment of interest on the Junior Subordinated Debentures, and
the Capital Securities are not considered issued with OID, a Securityholder's
adjusted tax basis in the Capital Securities generally will be its initial
purchase price. If the Junior Subordinated Debentures are deemed to be issued
with OID as a result of U. S. Bancorp's deferral of any interest payment or
otherwise, a Securityholder's tax basis in the Capital Securities generally will
be its initial purchase price, increased by OID previously includable in such
Securityholder's gross income to the date of disposition and decreased by
distributions or other payments received on the Capital Securities since and
including the date of the first Extension Period. Such gain or loss generally
will be a capital gain or loss (except to the extent any amount realized is
treated as a payment of accrued interest with respect to such holder's pro rata
share of the Junior Subordinated Debentures required to be included in income)
and generally will be a long-term capital gain or loss if the Capital Securities
have been held for more than one year.
If U. S. Bancorp exercises its option to defer any payment of interest on
the Junior Subordinated Debentures, the Capital Securities may trade at a price
that does not accurately reflect the value of accrued but unpaid interest with
respect to the underlying Junior Subordinated Debentures. In the event of such a
deferral, a Securityholder who disposes of Capital Securities between record
dates for payments of Distributions thereon will be required to include in
income as ordinary income accrued but unpaid interest on the Junior Subordinated
Debentures to the date of disposition as OID and to add such amount to its
adjusted tax basis in its pro rata share of the underlying Junior Subordinated
Debentures deemed disposed of. To the extent the selling price is less than the
holder's adjusted tax basis, such Securityholder will recognize a capital loss.
Subject to certain limited exceptions, capital losses cannot be applied to
offset ordinary income for United States federal income tax purposes.
BACKUP WITHHOLDING TAX AND INFORMATION REPORTING
The amount of interest income paid or accrued on the Capital Securities
held of record by United States Persons (other than corporations and other
exempt Securityholders) will be reported to the IRS. "Backup" withholding at a
rate of 31% will apply to payments of interest to non-exempt United States
Persons unless the Securityholder furnishes its taxpayer identification number
in the manner prescribed in applicable Treasury Regulations, certifies that such
number is correct, certifies as to no loss of exemption from backup withholding
and meets certain other conditions.
Payment of the proceeds from the disposition of Capital Securities to or
through the United States office of a broker is subject to information reporting
and backup withholding unless the holder or beneficial owner establishes an
exemption from information reporting and backup withholding.
Any amounts withheld from a Securityholder under the backup withholding
rules will be allowed as a refund or a credit against such Securityholder's
United States federal income tax liability, provided the required information is
furnished to the IRS.
It is anticipated that income on the Capital Securities will be reported
to holders on Form 1099 and mailed to holders of the Capital Securities by
January 31 following each calendar year.
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PROPOSED TAX LEGISLATION
On February 6, 1997, as part of the Clinton Administration's Fiscal 1998
Budget Proposal, the Treasury Department proposed legislation (the "Proposed
Legislation") which would, among other things, generally deny corporate issuers
a deduction for interest in respect of certain debt obligations, such as the New
Junior Subordinated Debentures, issued on or after the date "of first committee
action," if such debt obligations had a maximum term in excess of 15 years and
are not shown as indebtedness on the issuer's applicable consolidated balance
sheet. The Proposed Legislation has not yet been introduced by any member of the
105th Congress. If other legislation is enacted by Congress and if it gives rise
to a Tax Event, the Trust would be permitted to cause a redemption of the Trust
Securities by electing to redeem the Junior Subordinated Debentures. See
"Description of New Securities--Description of New Capital
Securities--Redemption" and "--Description of New Junior Subordinated
Debentures--Redemption."
THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS
INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A
HOLDER'S PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISERS WITH
RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE CAPITAL SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER
STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE POSSIBLE EFFECT OF CHANGES IN
UNITED STATES FEDERAL OR OTHER TAX LAWS.
CERTAIN ERISA CONSIDERATIONS
U. S. Bancorp, the obligor with respect to the New Junior Subordinated
Debentures held by the Trust, and its affiliates and the Property Trustee may be
considered a "party in interest" (within the meaning of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA")) or a "disqualified person"
(within the meaning of Section 4975 of the Code) with respect to many employee
benefit plans ("Plans") that are subject to ERISA. Any purchaser proposing to
acquire New Capital Securities with assets of any Plan should consult with its
counsel. The purchase and/or holding of New Capital Securities by a Plan that is
subject to the fiduciary responsibility provisions of ERISA or the prohibited
transaction provisions of Section 4975 of the Code (including individual
retirement arrangements and other plans described in Section 4975(e)(1) of the
Code) and with respect to which U. S. Bancorp, the Property Trustee or any
affiliate is a service provider (or otherwise is a party in interest or a
disqualified person) may constitute or result in a prohibited transaction under
ERISA or Section 4975 of the Code, unless such New Capital Securities are
acquired pursuant to and in accordance with an applicable exemption, such as
Prohibited Transaction Class Exemption ("PTCE") 84-14 (an exemption for certain
transactions determined by an independent qualified professional asset manager),
PTCE 91-38 (an exemption for certain transactions involving bank collective
investment funds), PTCE 90-1 (an exemption for certain transactions involving
insurance company pooled separate accounts), PTCE 95-60 (an exemption for
transactions involving certain insurance company general accounts) or PTCE 95-23
(an exemption for certain transactions determined by an in-house manager). In
addition, as described below, a Plan fiduciary considering the acquisition of
New Capital Securities should be aware that the assets of the Trust may be
considered "plan assets" for ERISA purposes. Therefore, a Plan fiduciary should
consider whether the acquisition of New Capital Securities could result in a
delegation of fiduciary authority to the Property Trustee, and, if so, whether
such a delegation of authority is permissible under the Plan's governing
instrument or any investment management agreement with the Plan. In making such
determination, a Plan fiduciary should note that the Property Trustee is a U.S.
bank qualified to be an investment manager (within the meaning of section 3(38)
of ERISA) to which such a delegation of authority generally would be permissible
under ERISA. Further, prior to an Event of Default with respect to the New
Junior Subordinated Debentures, the Property Trustee will have only limited
custodial and ministerial authority with respect to Trust assets.
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Under the U.S. Department of Labor regulations defining "plan assets" for
ERISA purposes (the "Plan Assets Regulations"), the assets of the Trust will be
considered plan assets of Plans owning New Capital Securities unless the
aggregate investment in New Capital Securities by "benefit plan investors" is
not deemed "significant" or the New Capital Securities qualify as "publicly
offered securities" as defined in such Regulations. For this purpose, equity
participation by benefit plan investors will not be considered "significant" on
any date only if, immediately after the most recent acquisition of New Capital
Securities, the aggregate interest in the New Capital Securities held by benefit
plan investors will be less than 25% of the value of the New Capital Securities.
Although it is possible that the equity participation by benefit plan investors
in New Capital Securities on any date will not be "significant" for purposes of
the Plan Assets Regulations, such result cannot be assured.
The New Capital Securities may qualify as "publicly offered securities"
under the Plan Assets Regulations if at the time of the Exchange Offer they are
also "widely held" and "freely transferable." Under the Regulations, a class of
securities is "widely held" only if it is a class of securities that is owned by
100 or more investors independent of the issuer and of one another. Although it
is possible that at the time of the Exchange Offer the New Capital Securities
will be "widely held," such result cannot be assured. Whether a security is
"freely transferable" for purposes of the Regulations is a factual question to
be determined on the basis of all relevant facts and circumstances. If at the
time of the Exchange Offer the New Capital Securities qualify as "publicly
offered securities," the assets of the Trust should not be "plan assets" with
respect to Plans acquiring New Capital Securities. If at the time of the
Exchange Offer the New Capital Securities do not qualify as "publicly offered
securities," the "plan asset" considerations discussed in the preceding
paragraphs could be applicable in connection with the investment by Plans in the
New Capital Securities.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Capital Securities for its own
account in connection with the Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such New Capital
Securities. This Prospectus, as it may be amended or supplemented from time to
time, may be used by Participating Broker-Dealers during the period referred to
below in connection with resales of New Capital Securities received in exchange
for Old Capital Securities if such Old Capital Securities were acquired by such
Participating Broker-Dealers for their own accounts as a result of market-making
activities or other trading activities. U. S. Bancorp and the Trust have agreed
that this Prospectus, as it may be amended or supplemented from time to time,
may be used by a Participating Broker-Dealer in connection with resales of such
New Capital Securities for a period ending 180 days after the Expiration Date
(subject to extension under certain limited circumstances described herein) or,
if earlier, when all such New Capital Securities have been disposed of by such
Participating Broker-Dealer. However, a Participating Broker-Dealer who intends
to use this Prospectus in connection with the resale of New Capital Securities
received in exchange for Old Capital Securities pursuant to the Exchange Offer
must notify U. S. Bancorp or the Trust, or cause U. S. Bancorp or the Trust to
be notified, on or prior to the Expiration Date, that it is a Participating
Broker-Dealer. Such notice may be given in the space provided for that purpose
in the Letter of Transmittal or may be delivered to the Exchange Agent at one of
the addresses set forth herein under "The Exchange Offer--Exchange Agent." See
"The Exchange Offer--Resales of New Capital Securities."
U. S. Bancorp or the Trust will not receive any cash proceeds from the
issuance of the New Capital Securities offered hereby. New Capital Securities
received by broker-dealers for their own accounts in connection with the
Exchange Offer may be sold from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions, through the writing of
options on the New Capital Securities or a combination of such methods of
resale, at market prices prevailing at the time of resale, at prices related
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to such prevailing market prices or at negotiated prices. Any such resale may be
made directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer and/or the purchasers of any such New Capital Securities.
Any broker-dealer that resells New Capital Securities that were received
by it for its own account in connection with the Exchange Offer and any broker
or dealer that participates in a distribution of such New Capital Securities may
be deemed to be an "underwriter" within the meaning of the Securities Act, and
any profit on any such resale of New Capital Securities and any commissions or
concessions received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The Letter of Transmittal states that by
acknowledging that it will deliver, and by delivering, a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
VALIDITY OF NEW SECURITIES
The validity of the New Guarantee and the New Junior Subordinated
Debentures have been passed upon for U. S. Bancorp by Miller, Nash, Wiener,
Hager & Carlsen LLP, Portland, Oregon. Certain matters relating to United States
federal income tax considerations described in this Prospectus have been passed
upon for U. S. Bancorp and the Trust by Miller, Nash, Wiener, Hager & Carlsen
LLP. Certain matters of Delaware law relating to the validity of the New Capital
Securities have been passed upon by Richards, Layton & Finger, Wilmington,
Delaware, special Delaware counsel to U. S. Bancorp and the Trust.
EXPERTS
The consolidated financial statements incorporated in this prospectus by
reference from U. S. Bancorp's Annual Report on Form 10-K for the year ended
December 31, 1996, have been audited by Deloitte & Touche LLP, independent
auditors, as stated in their report, which has been incorporated herein by
reference. The consolidated financial statements give retroactive effect to the
1995 merger of U. S. Bancorp and subsidiaries and West One Bancorp and
subsidiaries, which has been accounted for as a pooling of interests. The
consolidated statements of income, shareholders' equity, and cash flows of West
One Bancorp and subsidiaries for the year ended December 31, 1994 (not presented
separately in U. S. Bancorp's Annual Report on Form 10-K for the year ended
December 31, 1996) were audited by Coopers & Lybrand L.L.P., independent
auditors, as stated in its report, which report has been incorporated herein by
reference from U. S. Bancorp's Annual Report on Form 10-K for the year ended
December 31, 1996. Such reports have been incorporated herein by reference in
reliance upon the respective reports of such firms given upon their authority as
experts in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
ORS 60.367, a section of the Oregon Business Corporation Act ("Act"),
provides in substance that any director held liable for an unlawful distribution
in violation of ORS 60.367 is entitled to contribution from (i) every other
director who voted for or assented to the distribution without complying with
the applicable statutory standards of conduct and (ii) each shareholder for the
amount the shareholder accepted knowing the distribution was made in violation
of the Act or the corporation's articles of incorporation.
Under Sections 60.387 to 60.414 of the Act, a person who is made a party
to a proceeding because such person is or was an officer or director of a
corporation (an "Indemnitee") shall be indemnified by the corporation (unless
the corporation's articles of incorporation provide otherwise) against
reasonable expenses incurred by the Indemnitee in connection with the proceeding
if the Indemnitee is wholly successful on the merits or otherwise or if ordered
by a court of competent jurisdiction. In addition, under said sections a
corporation is permitted to indemnify an Indemnitee against liability incurred
in a proceeding if (i) the Indemnitee's conduct was in good faith and in a
manner he or she reasonably believed was in the corporation's best interests or
at least not opposed to its best interests, (ii) the Indemnitee had no
reasonable cause to believe his or her conduct was unlawful if the proceeding
was a criminal proceeding, (iii) the Indemnitee was not adjudged liable to the
corporation if the proceeding was by or in the right of the corporation (in
which case indemnification is limited to the Indemnitee's reasonable expenses in
connection with the proceeding) and (iv) the Indemnitee was not adjudged liable
on the basis that he or she improperly received a personal benefit.
Article VI of U. S. Bancorp's Articles of Incorporation contains the
following provision:
"A. The Corporation shall indemnify each of its directors and
officers to the fullest extent permissible under the Oregon Business
Corporation Act, as the same exists or may hereafter be amended, against
all expense, liability, and loss (including, without limitation,
attorneys' fees) incurred or suffered by such person by reason of or
arising from the fact that such person is or was a director or officer of
the Corporation, or is or was serving at the request of the Corporation as
a director, officer, partner, trustee, employee, or agent of another
foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan, or other enterprise, and such indemnification shall
continue as to a person who has ceased to be a director or officer and
shall inure to the benefit of his or her heirs, executors, and
administrators. The indemnification provided in this paragraph A shall not
be exclusive of any other rights to which any person may be entitled under
any statute, bylaw, agreement, resolution of shareholders or directors,
contract, or otherwise."
U. S. Bancorp has entered into an indemnification agreement with each of
its directors. Each such agreement provides that U. S. Bancorp will indemnify
the director (i) to the full extent authorized or permitted by the Act or any
other applicable statute or U. S. Bancorp's Articles of Incorporation or Bylaws
or any amendment thereof and (ii) against any obligation to pay a judgment,
settlement, penalty, fine or reasonable expenses, including attorney fees (any
of the foregoing, a "Liability") incurred in connection with any claim (as
defined), including a claim by or in the right of U. S. Bancorp; provided that
no indemnity shall be paid by U. S. Bancorp (A) if a final decision by a court
having jurisdiction shall determine that such indemnification is unlawful, (B)
on account of acts or omissions by the director which are finally adjudged to
have been not in good faith or to have involved intentional misconduct or a
knowing violation of law or (C) on
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<PAGE>
account of Liability under Section 16(b) of the Securities Exchange Act of 1934
or any similar provision of federal or state statutory law.
Each such agreement also provides that U. S. Bancorp will maintain in
effect, as long as the director continues to serve in such capacity and
thereafter so long as he or she is subject to any possible claim, directors' and
officers' liability insurance coverage at least comparable to the coverage
provided at the date the agreement was entered into unless such insurance is not
reasonably available or the premium cost is substantially disproportionate to
the amount or scope of coverage. In the event U. S. Bancorp does not maintain
such insurance coverage, U. S. Bancorp agrees to indemnify the director to the
full extent of the coverage in effect at the date the agreement was entered
into.
U. S. Bancorp maintains directors' and officers' liability insurance under
which U. S. Bancorp's directors and officers are insured against loss (as
defined) as a result of claims made against them for their wrongful acts in such
capacities.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
EXHIBIT
4.1 Form of Indenture of U. S. Bancorp relating to the New Junior Subordinated
Debentures (the "Indenture")*
4.2 Form of Certificate of New Junior Subordinated Debenture (included in
Article II of Exhibit 4.1)*
4.3 Certificate of Trust of U. S. Bancorp Capital I*
4.4 Declaration of Trust of U. S. Bancorp Capital I*
4.5 Amended and Restated Trust Agreement for U. S. Bancorp Capital I*
4.6 Form of New Capital Security Certificate for U. S. Bancorp Capital I*
4.7 Form of New Guarantee of U. S. Bancorp relating to the New Capital
Securities*
4.8 Registration Rights Agreement*
4.9 Agreement as to Expenses and Liabilities*
5.1 Opinion of Miller, Nash, Wiener, Hager & Carlsen LLP to U. S. Bancorp as
to legality of the New Junior Subordinated Debentures and the New
Guarantee to be issued by U. S. Bancorp
5.2 Opinion of Richards, Layton & Finger, special Delaware counsel, as to
legality of the New Capital Securities to be issued by U. S. Bancorp
Capital I
8 Opinion of Miller, Nash, Wiener, Hager & Carlsen LLP as to certain federal
income tax matters
12.1 Computation of ratios of consolidated earnings to fixed charges for the
five years ended December 31, 1996. Incorporated by reference to Exhibit
12.1 to U. S. Bancorp's Annual Report on Form 10-K for the year ended
December 31, 1996
12.2 Computation of ratios of consolidated earnings to combined fixed charges
and preferred stock dividends for the five years ended December 31, 1996
12.3 Computation of ratios of consolidated earnings to fixed charges and of
consolidated earnings to combined fixed charges and preferred stock
dividends for the three months ended March 31, 1997 and 1996
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Deloitte & Touche LLP
23.3 Consent of Miller, Nash, Wiener, Hager & Carlsen LLP (included in Exhibit
5.1)
23.4 Consent of Richards, Layton & Finger (included in Exhibit 5.2)
23.5 Consent of Miller, Nash, Wiener, Hager & Carlsen LLP (included in Exhibit
8)
24 Power of Attorney of certain officers and directors of U. S. Bancorp*
25.1 Form T-1 Statement of Eligibility of The First National Bank of Chicago to
act as trustee under the Indenture*
25.2 Form T-1 Statement of Eligibility of The First National Bank of Chicago to
act as trustee under the Amended and Restated Trust Agreement of U. S.
Bancorp Capital I*
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<PAGE>
25.3 Form T-1 Statement of Eligibility of the First National Bank of Chicago
under the New Guarantee for the benefit of the holders of New Capital
Securities of U. S. Bancorp Capital I*
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Exchange Agent Agreement
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*Previously filed.
ITEM 22. UNDERTAKINGS
Each of the undersigned Registrants hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, as amended (the
"Securities Act"), each filing of a Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act") (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of each
undersigned Registrant pursuant to the provisions described in Item 20 above, or
otherwise, each Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by each undersigned Registrant of expenses incurred or paid by a
director, officer or controlling person of each Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, each
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
The undersigned Registrants hereby undertake to respond to requests for
information that is incorporated by reference into the Prospectus pursuant to
Item 4, 10(b), 11 or 13 of this Form, within one business day of receipt of such
request, and to send the incorporated documents by first class mail or other
equally prompt means. This includes information contained in documents filed
subsequent to the effective date of the registration statement through the date
of responding to the request.
The undersigned Registrants hereby undertake to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired or involved therein, that was not the subject of and
included in the registration statement when it became effective.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this amendment to its registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Portland,
State of Oregon, on the 17th day of June, 1997.
U. S. BANCORP
By /s/ Thomas P. Ducharme
Thomas P. Ducharme
Executive Vice President and
Treasurer
Pursuant to the requirements of the Securities Act of 1933, this amendment
to its registration statement has been signed below by the following persons in
the capacities indicated on the 17th day of June, 1997.
Signature Title
--------- -----
(1) Principal Executive Officer and Director:
GERRY B. CAMERON* Chairman of the Board and Chief Executive
Officer and Director
(2) Principal Financial and Accounting Officer:
STEVEN P. ERWIN* Executive Vice President and Chief
Financial Officer
(3) A Majority of the Board of Directors:
HARRY BETTIS* Director
CAROLYN SILVA CHAMBERS* Director
FRANKLIN G. DRAKE* Director
ROBERT L. DRYDEN* Director
JOHN B. FERY* Director
JOSHUA GREEN III* Director
ALLEN T. NOBLE* Director
PAUL A. REDMOND* Director
N. STEWART ROGERS* Director
*By /s/ Sheryl W. Dawson
Sheryl W. Dawson
Attorney-in-fact
Pursuant to the requirements of the Securities Act of 1933, U. S. Bancorp
Capital I has duly caused this amendment to its registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Portland, State of Oregon, on the 17th day of June, 1997.
U. S. BANCORP CAPITAL I
By: /s/ William R. Basom
William R. Basom,
as Administrative Trustee
By: /s/ Phillip S. Rowley
Phillip S. Rowley,
as Administrative Trustee
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EXHIBIT INDEX
EXHIBIT
EXHIBIT
4.1 Form of Indenture of U. S. Bancorp relating to the New Junior Subordinated
Debentures (the "Indenture")*
4.2 Form of Certificate of New Junior Subordinated Debenture (included in
Article II of Exhibit 4.1)*
4.3 Certificate of Trust of U. S. Bancorp Capital I*
4.4 Declaration of Trust of U. S. Bancorp Capital I*
4.5 Amended and Restated Trust Agreement for U. S. Bancorp Capital I*
4.6 Form of New Capital Security Certificate for U. S. Bancorp Capital I*
4.7 Form of New Guarantee of U. S. Bancorp relating to the New Capital
Securities*
4.8 Registration Rights Agreement*
4.9 Agreement as to Expenses and Liabilities*
5.1 Opinion of Miller, Nash, Wiener, Hager & Carlsen LLP to U. S. Bancorp as
to legality of the New Junior Subordinated Debentures and the New
Guarantee to be issued by U. S. Bancorp
5.2 Opinion of Richards, Layton & Finger, special Delaware counsel, as to
legality of the New Capital Securities to be issued by U. S. Bancorp
Capital I
8 Opinion of Miller, Nash, Wiener, Hager & Carlsen LLP as to certain federal
income tax matters
12.1 Computation of ratios of consolidated earnings to fixed charges for the
five years ended December 31, 1996. Incorporated by reference to Exhibit
12.1 to U. S. Bancorp's Annual Report on Form 10-K for the year ended
December 31, 1996
12.2 Computation of ratios of consolidated earnings to combined fixed charges
and preferred stock dividends for the five years ended December 31, 1996
12.3 Computation of ratios of consolidated earnings to fixed charges and of
consolidated earnings to combined fixed charges and preferred stock
dividends for the three months ended March 31, 1997 and 1996
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Deloitte & Touche LLP
23.3 Consent of Miller, Nash, Wiener, Hager & Carlsen LLP (included in Exhibit
5.1)
23.4 Consent of Richards, Layton & Finger (included in Exhibit 5.2)
23.5 Consent of Miller, Nash, Wiener, Hager & Carlsen LLP (included in Exhibit
8)
24 Power of Attorney of certain officers and directors of U. S. Bancorp*
25.1 Form T-1 Statement of Eligibility of The First National Bank of Chicago to
act as trustee under the Indenture*
25.2 Form T-1 Statement of Eligibility of The First National Bank of Chicago to
act as trustee under the Amended and Restated Trust Agreement of U. S.
Bancorp Capital I*
25.3 Form T-1 Statement of Eligibility of the First National Bank of Chicago
under the New Guarantee for the benefit of the holders of New Capital
Securities of U. S. Bancorp Capital I*
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Exchange Agent Agreement
- --------------
*Previously filed.
II - 5
MILLER, NASH, WIENER, HAGER & CARLSEN LLP
ATTORNEYS AT LAW
3500 U. S. BANCORP TOWER
111 S.W. FIFTH AVENUE
PORTLAND, OREGON 97204-3699
TELEPHONE (503) 224-5858
FACSIMILE (503) 224-0155
June 17, 1997
U. S. Bancorp
111 S.W. Fifth Avenue
Portland, Oregon 97204
Subject: U. S. Bancorp
U. S. Bancorp Capital I
Registration Statement on Form S-4
File No. 333-25829
Ladies and Gentlemen:
We have acted as counsel to U. S. Bancorp, an Oregon
corporation, and U. S. Bancorp Capital I, a Delaware statutory business trust
(the "Trust"), in connection with the preparation and filing of a Registration
Statement on Form S-4 (the "Registration Statement") relating to: (i) the
proposed issuance by the Trust of up to $300,000,000 aggregate Liquidation
Amount of the Trust's 8.27% Capital Securities, Series B (the "New Capital
Securities"), registered under the Securities Act of 1933, as amended (the
"Securities Act"), in exchange for up to $300,000,000 aggregate Liquidation
Amount of the Trust's outstanding 8.27% Capital Securities, Series A (the "Old
Capital Securities"); (ii) the proposed issuance by U. S. Bancorp to the Trust,
in an aggregate principal amount corresponding to the aggregate Liquidation
Amount of the New Capital Securities, of U. S. Bancorp's 8.27% Junior
Subordinated Deferrable Interest Debentures due December 15, 2026 pursuant to an
indenture to be entered into between U. S. Bancorp and The First National Bank
of Chicago, as Trustee (the "New Junior Subordinated Debentures"), registered
under the Securities Act, in exchange for a comparable aggregate principal
amount of U. S. Bancorp's outstanding 8.27% Junior Subordinated Deferrable
Interest Debentures due December 15, 2026 issued pursuant to an Indenture dated
December 24, 1996 between U. S. Bancorp and The First National Bank of Chicago,
as Trustee (the "Old Junior Subordinated Debentures"); and (iii) U. S. Bancorp's
guarantee of the New Capital Securities (the "New Guarantee") registered under
the Securities Act in exchange for U. S. Bancorp's guarantee of the Old
Capital Securities (the "Old Guarantee"). The New Capital Securities will be
issued under an Amended and Restated Trust Agreement dated December 24, 1996
(the "Amended
<PAGE>
U. S. Bancorp - 2 - June 17, 1997
Agreement"), among U. S. Bancorp, as Depositor, The First National Bank of
Chicago, as property trustee, First Chicago Delaware, Inc., as Delaware trustee,
and the Administrative Trustees named therein.
We have examined such documents and records as we deemed
appropriate, including the following:
(i) Copy of the Amended and Restated Articles of
Incorporation, as amended, of U. S. Bancorp, certified as of a recent
date by an Assistant Secretary of U. S. Bancorp.
(ii) Copy of the Bylaws of U. S. Bancorp, as amended,
certified as of a recent date by an Assistant Secretary of U. S.
Bancorp to be a true and complete copy.
(iii) Copy, certified as of a recent date by an
Assistant Secretary of U. S. Bancorp to be a true copy, of the
resolutions adopted by the Board of Directors of U. S. Bancorp on
December 19, 1996, authorizing the filing of the Registration Statement
and the exchange of the New Capital Securities, the New Junior
Subordinated Debentures and the New Guarantee in the circumstances
referred to above.
(iv) Executed counterparts of the Amended Agreement.
(v) Specimen of the New Capital Security filed as
Exhibit 4.6 to the Registration Statement.
(vi) Form of the Indenture filed as Exhibit 4.1 to
the Registration Statement.
(vii) Specimen of the New Junior Subordinated
Debenture included in Article II of Exhibit 4.1 to the Registration
Statement.
(viii) Form of the New Guarantee filed as Exhibit 4.7
to the Registration Statement.
(ix) Executed counterparts of the Registration Rights
Agreement, dated as of December 24, 1996 (the "Registration Rights
Agreement"), among U. S. Bancorp, the Trust, and the Initial Purchasers
named therein.
<PAGE>
U. S. Bancorp - 3 - June 17, 1997
In addition, as to questions of fact material to our opinions,
we have relied upon certificates of officers of U. S. Bancorp, the
Administrative Trustees of the Trust and public officials.
In the course of our examination, we have assumed the legal
capacity of all natural persons, the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, the conformity to
original documents of all documents submitted to us as certified or photostatic
copies and the authenticity of the originals of such latter documents. In making
our examination of documents executed by parties other than U. S. Bancorp or the
Trust, we have assumed that such parties had the power, corporate or other, to
enter into and perform all obligations thereunder and have also assumed the due
authorization by all requisite action, corporate or other, and execution and
delivery by such parties of such documents and the validity and binding effect
thereof on such parties.
Based upon the foregoing, we are of the opinion that:
(1) The New Junior Subordinated Debentures have been duly
authorized by all requisite corporate action of U. S. Bancorp and, assuming the
due execution and delivery of the Indenture on behalf of U. S. Bancorp and The
First National Bank of Chicago, in substantially the form included as Exhibit
4.1 to the Registration Statement, and qualification of the Indenture under the
Trust Indenture Act of 1939, as amended, the New Junior Subordinated Debentures,
when executed and authenticated in the manner provided for in the Indenture and
delivered against surrender and cancellation of a like aggregate principal
amount of Old Junior Subordinated Debentures as contemplated in the Registration
Rights Agreement, will constitute valid and binding obligations of U. S. Bancorp
entitled to the benefits of the Indenture and enforceable against U. S. Bancorp
in accordance with their terms, subject as to enforcement to the effect of
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
laws affecting the rights and remedies of creditors generally and to the effect
of general principles of equity, whether applied by a court of law or equity.
(2) The New Guarantee has been duly authorized by all
requisite corporate action of U. S. Bancorp and, when executed and delivered to
The First National Bank of Chicago, as guarantee trustee, in substantially the
form included as Exhibit 4.7 to the Registration Statement and as contemplated
in the Registration Rights Agreement, the New Guarantee will constitute a valid
and binding agreement of U. S. Bancorp, enforceable against U. S. Bancorp in
accordance with its terms, subject as to enforcement to the effect of
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
laws affecting the rights and remedies of creditors generally and to the effect
of general principles of equity, whether applied by a court of law or equity.
<PAGE>
U. S. Bancorp - 4 - June 17, 1997
This opinion is based upon the laws of the United States and
the state of Oregon at the date hereof and would not necessarily be the same at
any subsequent date.
We consent to the use of this opinion in the Registration
Statement and in any amendments thereto and to the reference to our firm under
the caption "Validity of New Securities" contained in the Prospectus included
therein. In giving this consent, we do not thereby admit that we come within the
category of persons whose consent is required under Section 7 of the Securities
Act or the rules and regulations of the Commission thereunder.
Very truly yours,
/s/ Miller, Nash, Wiener, Hager & Carlsen LLP
MILLER, NASH, WIENER, HAGER & CARLSEN LLP
[Letterhead of Richards, Layton & Finger]
June 17, 1997
U. S. Bancorp Capital I
c/o U. S. Bancorp
111 S.W. Fifth Avenue
Portland, Oregon 97204
Re: U. S. Bancorp Capital I
Ladies and Gentlemen:
We have acted as special Delaware counsel for U. S. Bancorp,
an Oregon corporation (the "Company"), and U. S. Bancorp Capital I, a Delaware
business trust (the "Trust"), in connection with the matters set forth herein.
At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated December 18,
1996 (the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on December 19, 1996;
(b) The Declaration of Trust of the Trust, dated as of
December 18, 1996, by and between the Company, as depositor, and Phillip S.
Rowley, William R. Basom, and First Chicago Delaware Inc., as trustees of the
Trust;
<PAGE>
U. S. Bancorp Capital I
June 17, 1997
Page 2
(c) The Amended and Restated Trust Agreement of the Trust,
dated as of December 24, 1996 (including Exhibit E) (the "Trust Agreement"),
among the Company, The First National Bank of Chicago, as property trustee,
First Chicago Delaware Inc., as Delaware trustee, the administrative trustees
named therein, and the several Holders of Trust Securities;
(d) The registration statement (the "Initial Registration
Statement") on Form S-4 (Registration No. 333-25829), filed by the Company and
the Trust with the Securities and Exchange Commission (the "SEC") on April 25,
1997, as amended by Amendment No. 1 to the Initial Registration Statement,
relating to the 8.27% Capital Securities, Series B of the Trust representing
beneficial interests in the assets of the Trust (each, a "Preferred Security"
and collectively, the "Preferred Securities"), among other securities, as
proposed to be filed by the Company and the Trust with the SEC on or about June
17, 1997 ("Amendment No. 1") (the Initial Registration Statement, as amended by
Amendment No. 1, is hereinafter referred to as the "Registration Statement");
(e) The Registration Rights Agreement dated as of December 24,
1996 (the "Registration Rights Agreement") among the Company, the Trust, and
Goldman, Sachs & Co., Lehman Brothers, Inc., and Salomon Brothers Inc; and
(f) A Certificate of Good Standing for the Trust, dated June
17, 1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise
defined are used as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed above, and we have assumed that there
exists no provision in any document that we have not reviewed that bears upon or
is inconsistent with the opinions stated herein. We have conducted no
independent factual investigation of our own but rather have relied solely upon
the foregoing documents, the statements and information set forth therein and
the additional matters recited or assumed herein, all of which we have assumed
to be true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Trust Agreement constitutes the entire agreement among the parties thereto with
respect to the subject matter thereof, including with respect to the creation,
operation and termination of the Trust, and that
<PAGE>
U. S. Bancorp Capital I
June 17, 1997
Page 3
the Trust Agreement and the Certificate are in full force and effect and have
not been amended, (ii) except to the extent provided in paragraph 1 below, the
due creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, and (vi) that
the Delaware Trustee satisfies the requirements of Section 3807 of the Delaware
Business Trust Act, 12 Del. C. Section 3801, et seq (the "Act"). We have not
participated in the preparation of the Registration Statement and assume no
responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in
good standing as a business trust under the Act.
2. The Preferred Securities have been duly authorized for
issuance by the Trust and when (i) the Registration Statement becomes effective
and the Trust Agreement has been qualified under the Trust Indenture Act of
1939, as amended, and (ii) the Preferred Securities are duly executed,
authenticated and issued in accordance with the Trust Agreement and delivered
and issued in the exchange offer as contemplated by the Registration Rights
Agreement and the Registration Statement, the Preferred Securities will
represent, subject to the qualifications set forth in paragraph 3 below, fully
paid and nonassessable undivided beneficial interests in the assets of the
Trust.
3. The holders of the Preferred Securities, as beneficial
owners of the Trust, will be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of
<PAGE>
U. S. Bancorp Capital I
June 17, 1997
Page 4
Delaware. We note that the holders of the Preferred Securities may be obligated
to make payments as set forth in the Trust Agreement.
We consent to the filing of this opinion with the SEC as an
exhibit to the Registration Statement. In addition, we hereby consent to the use
of our name under the heading "Validity of New Securities" in the prospectus
which forms a part of the Registration Statement. In giving the foregoing
consents, we do not thereby admit that we come within the category of persons
whose consent is required under Section 7 of the Securities Act of 1933, as
amended, or the rules and regulations of the SEC thereunder. Except as stated
above, without our prior written consent, this opinion may not be furnished or
quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
/s/ RICHARDS, LAYTON & FINGER
MILLER, NASH, WIENER, HAGER & CARLSEN LLP
ATTORNEYS AT LAW
3500 U. S. BANCORP TOWER
111 S.W. FIFTH AVENUE
PORTLAND, OREGON 97204-3699
TELEPHONE (503) 224-5858
FACSIMILE (503) 224-0155
June 17, 1997
U. S. Bancorp
111 S.W. Fifth Avenue
Portland, Oregon 97204
Subject: U. S. Bancorp
U. S. Bancorp Capital I
Registration Statement on Form S-4
File No. 333-25829
Ladies and Gentlemen:
We have acted as tax counsel to U. S. Bancorp, an Oregon
corporation, and U. S. Bancorp Capital I, a Delaware statutory business trust
(the "Trust"), in connection with the offer to exchange up to $300,000,000
aggregate Liquidation Amount of the Trust's 8.27% Capital Securities, Series
B, registered under the Securities Act of 1933, as amended (the "Securities
Act"), for a like Liquidation Amount of the Trust's outstanding 8.27%
Capital Securities, Series A. In rendering our opinion, we have examined the
Amended and Restated Trust Agreement dated as of December 24, 1996 (the "Trust
Agreement"), and have assumed that the Issuer Trustees will conduct the affairs
of the Trust in accordance with the Trust Agreement. We hereby confirm the
opinions described under the caption "Certain Federal Income Tax Consequences"
in the prospectus (the "Prospectus") that is part of the Registration Statement
on Form S-4 (File No. 333-25829). Capitalized terms used herein but not defined
have the meanings as provided in the Prospectus.
We hereby consent to the use of this opinion in the
Registration Statement and in any amendments thereto and to the reference to our
firm under the caption "Certain Federal Income Tax Consequences" in the
Prospectus. In giving this consent, we do not
<PAGE>
U. S. Bancorp - 2 - June 17, 1997
thereby admit that we come within the category of persons whose consent is
required under Section 7 of the Securities Act or the rules and regulations of
the Commission thereunder.
Very truly yours,
/s/ Miller, Nash, Wiener, Hager & Carlsen LLP
MILLER, NASH, WIENER, HAGER & CARLSEN LLP
<TABLE>
<CAPTION>
U. S. Bancorp and Subsidiaries
Computation of Ratios of Consolidated Earnings to Combined Fixed Charges and Preferred Stock Dividends
(in Thousands)
For the Years Ended December 31,
1996 1995 1994 1993 1992
---------- ---------- ---------- ----------- ---------
Considering Interest on Deposits as an Operating
Expense
<S> <C> <C> <C> <C> <C>
Net income $ 478,894 $ 328,971 $ 254,666 $ 341,136 $ 211,556
Accounting change -- -- -- -- 59,890
Income taxes 262,958 180,268 108,531 163,691 120,503
--------- --------- --------- --------- ---------
Earnings before income taxes and
accounting changes 741,852 509,239 363.197 504,827 391,949
--------- --------- --------- --------- ---------
Add: Fixed Charges
Interest on borrowed funds including
capitalized interest 248,967 283,059 215,004 172,414 217,261
Interest income from federal funds sold(A) (5,511) (3,959) (3,090) (5,259) (11,562)
Interest component of leases(B) 16,192 17,623 18,510 17,310 15,257
Preferred dividends(C) 18,880 18,865 17,380 18,036 9,874
--------- --------- --------- --------- ---------
Total fixed charges 278,528 315,588 247,804 202,501 230,830
Less: capitalized interest -- -- (93) (96) (470)
--------- --------- --------- --------- ---------
Fixed charges 278,528 315,588 247,711 202,405 230,360
--------- --------- --------- --------- ---------
Earning before income taxes, accounting
changes and fixed charges $1,020,380 $ 824,827 $ 610,908 $ 707,232 $ 622,309
========= ========= ========= ========= =========
Ratios of earnings to total fixed charges 3.66x 2.61x 2.47x 3.49x 2.70x
======== ======== ======== ========= ========
Considering Interest on Deposits as Fixed Charges(A)
Fixed charges as shown above $ 278,528 $ 315,588 $ 247,804 $ 202,501 $ 230,830
Interest on deposits 768,170 710,044 523,780 525,807 608,439
--------- --------- --------- --------- ---------
Total fixed charges 1,046,698 1,025,632 771,584 728,308 839,269
Less: capitalized interest -- -- (93) (96) (470)
--------- --------- --------- --------- ---------
Fixed charges 1,046,698 1,025,632 771,491 728,212 838,799
Add: earnings before income taxes and
accounting changes 741,852 509,239 363,197 504,827 391,949
--------- --------- --------- --------- ---------
Earning before income taxes, accounting
changes and fixed charges $1,788,550 $1,534,871 $1,134,688 $1,233,039 $1,230,748
========= ========= ========= ========= =========
Ratios of earnings to total fixed charges 1.71x 1.50x 1.47x 1.69x 1.47x
========= ========= ========= ========= =========
</TABLE>
- 1 -
<PAGE>
A Approximates interest expense related to federal funds purchased
transactions for purposes other than funding of banking subsidiaries'
operations.
B Interest component of leases includes imputed interest on capitalized
leases and approximately one-third of rental expense, which approximates
the interest component of operating leases.
C Preferred dividends were increased to amounts representing pretax earnings
that would be required to cover the dividend requirements.
- 2 -
U. S. Bancorp and Subsidiaries
Computation of Ratios of Consolidated Earnings to Fixed Charges
(in Thousands)
First Quarter
Ended March 31,
---------------------
1997 1996
--------- ---------
Considering Interest on Deposits as an Operating Expense
Net income $ 121,470 $ 112,914
Income taxes 68,047 62,533
-------- --------
Earnings before income taxes 189,517 175,447
-------- --------
Add: Fixed Charges
Interest on borrowed funds 67,369 61,938
Interest income from federal funds sold(A) 783 (1,988)
Interest component of leases(B) 3,845 4,028
-------- --------
Total fixed charges 71,997 63,978
-------- --------
Earnings before income taxes and fixed charges $ 261,514 $ 239,425
======== ========
Ratios of earnings to total fixed charges 3.63x 3.74x
Considering Interest on Deposits as Fixed Charges(A)
Fixed charges as shown above $ 71,997 $ 63,978
Interest on deposits 193,157 189,812
-------- --------
Total fixed charges 265,154 253,790
Add: earnings before income taxes 189,517 175,447
-------- --------
Earnings before income taxes and fixed charges $ 454,671 $ 429,237
======== ========
Ratios of earnings to total fixed charges 1.71x 1.69x
======== ========
A - Approximates interest expense related to federal funds purchased
transactions for purposes other than funding of banking subsidiaries'
operations.
B - Interest component of leases includes imputed interest on capitalized
leases and approximately one-third of rental expense, which approximates
the interest component of operating leases.
- 3 -
<PAGE>
U. S. Bancorp and Subsidiaries
Computation of Ratios of Consolidated Earnings to Combined Fixed Charges
and Preferred Stock Dividends
(in Thousands)
First Quarter
Ended March 31,
---------------------
1997 1996
--------- ---------
Considering Interest on Deposits as an Operating Expense
Net income $ 121,470 $ 112,914
Income taxes 68,047 62,533
-------- --------
Earnings before income taxes 189,517 175,447
-------- --------
Add: Fixed Charges
Interest on borrowed funds 67,369 61,938
Interest income from federal funds sold(A) 783 (1,988)
Interest component of leases(B) 3,845 4,028
Preferred dividends(C) 4,756 4,736
-------- --------
Total fixed charges 76,753 68,714
-------- --------
Earnings before income taxes and fixed charges $ 266,270 $ 244,161
======== ========
Ratios of earnings to total fixed charges 3.47x 3.55x
======== ========
Considering Interest on Deposits as Fixed Charges(A)
Fixed charges as shown above $ 76,753 $ 68,714
Interest on deposits 193,157 189,812
-------- --------
Total fixed charges 269,910 258,526
Add: earnings before income taxes 189,517 175,447
-------- --------
Earnings before income taxes and fixed charges $ 459,427 $ 433,973
======== ========
Ratios of earnings to total fixed charges 1.70x 1.68x
======== ========
A - Approximates interest expense related to federal funds purchased
transactions for purposes other than funding of banking subsidiaries'
operations.
B - Interest component of leases includes imputed interest on capitalized
leases and approximately one-third of rental expense, which approximates
the interest component of operating leases.
C - Preferred dividends were increased to amounts representing pretax earnings
that would be required to cover the dividend requirements.
- 4 -
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Amendment No. 1 to
Registration Statement No. 333-25829 of U. S. Bancorp on Form S-4 of our report
dated January 19, 1995, on our audit of the consolidated financial statements of
income, shareholders' equity and cash flows of West One Bancorp and Subsidiaries
for the year ended December 31, 1994, which report is included in the U. S.
Bancorp's 1996 Annual Report on Form 10-K. We also consent to the reference to
our firm under the caption "Experts".
/s/ Coopers & Lybrand LLP
COOPERS & LYBRAND L.L.P.
Boise, Idaho
June 17, 1997
(LOGO)
DELOITTE & TOUCHE LLP
SUITE 3900
111 S.W. FIFTH AVENUE
PORTLAND, OREGON 97204-3698
TELEPHONE: (503) 222-1341
FACSIMILE: (503) 224-2172
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Amendment No. 1 to
Registration Statement No. 333-25829 of U.S. Bancorp on Form S-4 of our report
dated January 31, 1997 appearing in the Annual Report on Form 10-K of U.S.
Bancorp for the year ended December 31, 1996, and to the reference to us under
the heading "Experts" in this Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
June 17, 1997
- ---------------
Deloitte Touche
Tohmatsu
International
- ---------------
EXHIBIT 99.1
LETTER OF TRANSMITTAL
U. S. BANCORP CAPITAL I
OFFER TO EXCHANGE ITS
8.27% CAPITAL SECURITIES, SERIES B
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
8.27% CAPITAL SECURITIES, SERIES A
UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
U. S. BANCORP
PURSUANT TO THE PROSPECTUS DATED JUNE __, 1997
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON JULY __, 1997, UNLESS THE OFFER IS EXTENDED. TENDERS MAY BE WITHDRAWN
PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
The Exchange Agent for the Exchange Offer is:
The First National Bank of Chicago
By Registered or Certified Mail, Hand or
Overnight Delivery:
The First National Bank of Chicago
c/o First Chicago Trust
Company of New York
14 Wall Street
8th Floor, Window 2
New York, New York 10005
Attn: Corporate Trust Administration
To Confirm by Telephone or for
Information Call:
(212) 240-8801
Facsimile Transmissions:
(Eligible Institutions Only)
(212) 240-8938
Delivery of this letter of transmittal to an address other
than as set forth above or transmission of this letter of transmittal via
facsimile to a number other than as set forth above does not constitute a valid
delivery.
THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY
BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
- 1 -
<PAGE>
Capitalized terms used but not defined herein shall have the
same meaning given them in the Prospectus (as defined below).
This Letter of Transmittal is to be completed either if (a)
certificates (the "Certificates") for Old Capital Securities are to be forwarded
herewith or (b) tenders are to be made pursuant to the procedures for tender by
book-entry transfer set forth under "The Exchange Offer--Procedures for
Tendering Old Capital Securities" in the Prospectus and an Agent's Message (as
defined below) is not delivered. Certificates, or book-entry confirmation of a
book-entry transfer of such Old Capital Securities into the Exchange Agent's
account at The Depository Trust Company ("DTC"), as well as this Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, with
any required signature guarantees, and any other documents required by this
Letter of Transmittal, must be received by the Exchange Agent at its address set
forth herein on or prior to the Expiration Date. Tenders by book-entry transfer
may also be made by delivering an Agent's Message in lieu of this Letter of
Transmittal. The term "book-entry confirmation" means a confirmation of a
book-entry transfer of Old Capital Securities into the Exchange Agent's account
at DTC. The term "Agent's Message" means a message, transmitted by DTC to and
received by the Exchange Agent and forming a part of a book-entry confirmation,
which states that DTC has received an express acknowledgment from the tendering
participant, which acknowledgment states that such participant has received and
agrees to be bound by this Letter of Transmittal and that the Trust and U. S.
Bancorp, an Oregon corporation, may enforce this Letter of Transmittal against
such participant.
Holders of Old Capital Securities whose Certificates are not
immediately available or who cannot deliver their Certificates and all other
required documents to the Exchange Agent on or prior to the Expiration Date (as
defined in the Prospectus) or who cannot complete the procedures for book-entry
transfer on a timely basis, must tender their Old Capital Securities according
to the guaranteed delivery procedures set forth in "The Exchange
Offer--Procedures for Tendering Old Capital Securities" in the Prospectus.
DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER
FACILITY DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
- 2 -
<PAGE>
ALL TENDERING HOLDERS COMPLETE THIS BOX:
DESCRIPTION OF OLD CAPITAL SECURITIES TENDERED
If blank, please print name and Old Capital Securities Tendered
address of registered holder below. (Attach additional list if necessary)
Aggregate
Liquidation Liquidation Amount
Amount of of Old Capital
Certificate Old Capital Securities Tendered
Number(s)* Securities (if less than all)**
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
TOTAL AMOUNT
TENDERED:
- --------------------------------------------------------------------------------
* Need not be completed by book-entry holders.
** Old Capital Securities may be tendered in whole or in part in a
Liquidation Amount of $100,000 and any integral multiple of $1,000 in
excess thereof, provided that if any Old Capital Securities are
tendered for exchange in part, the untendered Liquidation Amount
thereof must be $100,000 or any integral multiple of $1,000 in excess
thereof. All Old Capital Securities held shall be deemed tendered
unless a lesser number is specified in this column. See Instruction 4.
- --------------------------------------------------------------------------------
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<PAGE>
(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY)
CHECK HERE IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC AND
COMPLETE THE FOLLOWING:
Name of Tendering Institution
DTC Account Number
Transaction Code Number
CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED DELIVERY IF
TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE
FOLLOWING:
Name of Registered Holder(s)
Window Ticket Number (if any)
Date of Execution of Notice of Guaranteed Delivery
Name of Institution which Guaranteed Delivery
If Guaranteed Delivery is to be made by Book-Entry Transfer:
Name of Tendering Institution
DTC Account Number
Transaction Code Number
CHECK HERE IF TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED OLD CAPITAL
SECURITIES ARE TO BE RETURNED BY CREDITING THE DTC ACCOUNT NUMBER SET FORTH
ABOVE.
CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OLD CAPITAL SECURITIES
FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER TRADING ACTIVITIES
(A "PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF
THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
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<PAGE>
Name:
Address:
Ladies and Gentlemen:
The undersigned hereby tenders to U. S. Bancorp Capital I, a
statutory business trust created under the laws of the State of Delaware (the
"Trust") and U. S. Bancorp, an Oregon corporation, the above described aggregate
Liquidation Amount of the Trust's 8.27% Capital Securities, Series A (the "Old
Capital Securities") in exchange for a like aggregate Liquidation Amount of the
Trust's 8.27% Capital Securities, Series B (the "New Capital Securities") which
have been registered under the Securities Act of 1933 (the "Securities Act"),
upon the terms and subject to the conditions set forth in the Prospectus dated
June ..., 1997 (as the same may be amended or supplemented from time to time,
the "Prospectus"), receipt of which is hereby acknowledged, and in this Letter
of Transmittal (which, together with the Prospectus, constitutes the "Exchange
Offer").
Subject to and effective upon the acceptance for exchange of
all or any portion of the Old Capital Securities tendered herewith in accordance
with the terms and conditions of the Exchange Offer (including, if the Exchange
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the undersigned hereby sells, assigns, and transfers to or upon the
order of the Trust all right, title, and interest in and to such Old Capital
Securities as are being tendered herewith. The undersigned hereby irrevocably
constitutes and appoints the Exchange Agent as its agent and attorney-in-fact
(with full knowledge that the Exchange Agent is also acting as agent of U. S.
Bancorp and the Trust in connection with the Exchange Offer) with respect to the
tendered Old Capital Securities, with full power of substitution (such power of
attorney being deemed to be an irrevocable power coupled with an interest)
subject only to the right of withdrawal described in the Prospectus, to (i)
deliver Certificates for Old Capital Securities to U. S. Bancorp or the Trust
together with all accompanying evidences of transfer and authenticity to, or
upon the order of, the Trust, upon receipt by the Exchange Agent, as the
undersigned's agent, of the New Capital Securities to be issued in exchange for
such Old Capital Securities, (ii) present Certificates for such Old Capital
Securities for transfer, and to transfer the Old Capital Securities on the books
of the Trust, and (iii) receive for the account of the Trust all benefits and
otherwise exercise all rights of beneficial ownership of such Old Capital
Securities, all in accordance with the terms and conditions of the Exchange
Offer.
THE UNDERSIGNED HEREBY REPRESENTS AND WARRANTS THAT THE
UNDERSIGNED HAS FULL POWER AND AUTHORITY TO TENDER, EXCHANGE, SELL, ASSIGN AND
TRANSFER THE OLD CAPITAL SECURITIES TENDERED HEREBY AND THAT, WHEN THE SAME ARE
ACCEPTED FOR EXCHANGE, THE TRUST WILL ACQUIRE GOOD, MARKETABLE AND UNENCUMBERED
TITLE THERETO, FREE AND CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES AND
ENCUMBRANCES, AND THAT THE OLD CAPITAL
- 5 -
<PAGE>
SECURITIES TENDERED HEREBY ARE NOT SUBJECT TO ANY ADVERSE CLAIMS OR PROXIES. THE
UNDERSIGNED WILL, UPON REQUEST, EXECUTE AND DELIVER ANY ADDITIONAL DOCUMENTS
DEEMED BY U. S. BANCORP, THE TRUST OR THE EXCHANGE AGENT TO BE NECESSARY OR
DESIRABLE TO COMPLETE THE EXCHANGE, ASSIGNMENT AND TRANSFER OF THE OLD CAPITAL
SECURITIES TENDERED HEREBY, AND THE UNDERSIGNED WILL COMPLY WITH ITS OBLIGATIONS
UNDER THE REGISTRATION RIGHTS AGREEMENT. THE UNDERSIGNED HAS READ AND AGREES TO
ALL OF THE TERMS OF THE EXCHANGE OFFER.
The name(s) and address(es) of the registered holder(s) of the
Old Capital Securities tendered hereby should be printed above, if they are not
already set forth above, as they appear on the Certificates representing such
Old Capital Securities. The Certificate number(s) and the Old Capital Securities
that the undersigned wishes to tender should be indicated in the appropriate
boxes above.
If any tendered Old Capital Securities are not exchanged
pursuant to the Exchange Offer for any reason, or if Certificates are submitted
for more Old Capital Securities than are tendered or accepted for exchange,
Certificates for such nonexchanged or nontendered Old Capital Securities will be
returned (or, in the case of Old Capital Securities tendered by book-entry
transfer, such Old Capital Securities will be credited to an account maintained
at DTC), without expense to the tendering holder, promptly following the
expiration or termination of the Exchange Offer.
The undersigned understands that tenders of Old Capital
Securities pursuant to any one of the procedures described in "The Exchange
Offer--Procedures for Tendering Old Capital Securities" in the Prospectus and in
the instructions attached hereto will, upon the acceptance for exchange by U. S.
Bancorp and the Trust of such tendered Old Capital Securities, constitute a
binding agreement between the undersigned, U. S. Bancorp and the Trust upon the
terms and subject to the conditions of the Exchange Offer. The undersigned
recognizes that, under certain circumstances set forth in the Prospectus, U. S.
Bancorp and the Trust may not be required to accept for exchange any of the Old
Capital Securities tendered hereby.
Unless otherwise indicated herein in the box entitled "Special
Issuance Instructions" below, the undersigned hereby directs that the New
Capital Securities be issued in the name(s) of the undersigned or, in the case
of a book-entry transfer of Old Capital Securities, that such New Capital
Securities be credited to the account indicated above maintained at DTC. If
applicable, substitute Certificates representing Old Capital Securities not
exchanged or not accepted for exchange will be issued to the undersigned or, in
the case of a book-entry transfer of Old Capital Securities, will be credited to
the account indicated above maintained at DTC. Similarly, unless otherwise
indicated under "Special Delivery Instructions" below, please deliver New
Capital Securities to the undersigned at the address shown below the
undersigned's signature.
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<PAGE>
BY TENDERING OLD CAPITAL SECURITIES AND EXECUTING THIS LETTER
OF TRANSMITTAL, THE UNDERSIGNED HEREBY REPRESENTS AND AGREES THAT (I) THE
UNDERSIGNED IS NOT AN "AFFILIATE" OF U. S. BANCORP OR THE TRUST, (II) ANY NEW
CAPITAL SECURITIES TO BE RECEIVED BY THE UNDERSIGNED ARE BEING ACQUIRED IN THE
ORDINARY COURSE OF ITS BUSINESS, (III) THE UNDERSIGNED HAS NO ARRANGEMENT OR
UNDERSTANDING WITH ANY PERSON TO PARTICIPATE IN A DISTRIBUTION (WITHIN THE
MEANING OF THE SECURITIES ACT) OF NEW CAPITAL SECURITIES TO BE RECEIVED IN THE
EXCHANGE OFFER, AND (IV) IF THE UNDERSIGNED IS NOT A BROKER-DEALER, THE
UNDERSIGNED IS NOT ENGAGED IN, AND DOES NOT INTEND TO ENGAGE IN, A DISTRIBUTION
(WITHIN THE MEANING OF THE SECURITIES ACT) OF SUCH NEW CAPITAL SECURITIES. BY
TENDERING OLD CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER AND EXECUTING
THIS LETTER OF TRANSMITTAL, A HOLDER OF OLD CAPITAL SECURITIES WHICH IS A
BROKER-DEALER REPRESENTS AND AGREES, CONSISTENT WITH CERTAIN INTERPRETIVE
LETTERS ISSUED BY THE STAFF OF THE DIVISION OF CORPORATION FINANCE OF THE
SECURITIES AND EXCHANGE COMMISSION TO THIRD PARTIES, THAT (A) SUCH OLD CAPITAL
SECURITIES HELD BY THE BROKER-DEALER ARE HELD ONLY AS A NOMINEE, OR (B) SUCH OLD
CAPITAL SECURITIES WERE ACQUIRED BY SUCH BROKER-DEALER FOR ITS OWN ACCOUNT AS A
RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES AND IT WILL
DELIVER THE PROSPECTUS (AS AMENDED OR SUPPLEMENTED FROM TIME TO TIME) MEETING
THE REQUIREMENTS OF THE SECURITIES ACT IN CONNECTION WITH ANY RESALE OF SUCH NEW
CAPITAL SECURITIES (PROVIDED THAT, BY SO ACKNOWLEDGING AND BY DELIVERING A
PROSPECTUS, SUCH BROKER-DEALER WILL NOT BE DEEMED TO ADMIT THAT IT IS AN
"UNDERWRITER" WITHIN THE MEANING OF THE SECURITIES ACT).
U. S. BANCORP AND THE TRUST HAVE AGREED THAT, SUBJECT TO THE
PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT, THE PROSPECTUS, AS IT MAY BE
AMENDED OR SUPPLEMENTED FROM TIME TO TIME, MAY BE USED BY A PARTICIPATING
BROKER-DEALER (AS DEFINED BELOW) IN CONNECTION WITH RESALES OF NEW CAPITAL
SECURITIES RECEIVED IN EXCHANGE FOR OLD CAPITAL SECURITIES, WHERE SUCH OLD
CAPITAL SECURITIES WERE ACQUIRED BY SUCH PARTICIPATING BROKER-DEALER FOR ITS OWN
ACCOUNT AS A RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES, FOR
A PERIOD ENDING 180 DAYS AFTER THE EXPIRATION DATE (SUBJECT TO EXTENSION UNDER
CERTAIN LIMITED CIRCUMSTANCES DESCRIBED IN THE PROSPECTUS) OR, IF EARLIER, WHEN
ALL SUCH NEW CAPITAL SECURITIES HAVE BEEN DISPOSED OF BY SUCH PARTICIPATING
BROKER-DEALER. IN THAT REGARD, EACH BROKER-DEALER WHO ACQUIRED OLD CAPITAL
SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET-MAKING OR OTHER TRADING
ACTIVITIES (A "PARTICIPATING BROKER-DEALER"), BY TENDERING SUCH OLD CAPITAL
- 7 -
<PAGE>
SECURITIES AND EXECUTING THIS LETTER OF TRANSMITTAL OR EFFECTING DELIVERY OF AN
AGENT'S MESSAGE IN LIEU THEREOF, AGREES THAT, UPON RECEIPT OF NOTICE FROM U. S.
BANCORP OR THE TRUST OF THE OCCURRENCE OF ANY EVENT OR THE DISCOVERY OF ANY FACT
WHICH MAKES ANY STATEMENT CONTAINED OR INCORPORATED BY REFERENCE IN THE
PROSPECTUS UNTRUE IN ANY MATERIAL RESPECT OR WHICH CAUSES THE PROSPECTUS TO OMIT
TO STATE A MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS CONTAINED OR
INCORPORATED BY REFERENCE THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH
THEY WERE MADE, NOT MISLEADING OR OF THE OCCURRENCE OF CERTAIN OTHER EVENTS
SPECIFIED IN THE REGISTRATION RIGHTS AGREEMENT, SUCH PARTICIPATING BROKER-DEALER
WILL SUSPEND THE SALE OF NEW CAPITAL SECURITIES PURSUANT TO THE PROSPECTUS UNTIL
U. S. BANCORP AND THE TRUST HAVE AMENDED OR SUPPLEMENTED THE PROSPECTUS TO
CORRECT SUCH MISSTATEMENT OR OMISSION AND HAVE FURNISHED COPIES OF THE AMENDED
OR SUPPLEMENTED PROSPECTUS TO THE PARTICIPATING BROKER-DEALER OR U. S. BANCORP
OR THE TRUST HAS GIVEN NOTICE THAT SALES OF THE NEW CAPITAL SECURITIES MAY BE
RESUMED, AS THE CASE MAY BE. IF U. S. BANCORP OR THE TRUST GIVES SUCH NOTICE TO
SUSPEND THE SALE OF THE NEW CAPITAL SECURITIES, THEY SHALL EXTEND THE 180-DAY
PERIOD REFERRED TO ABOVE DURING WHICH PARTICIPATING BROKER-DEALERS ARE ENTITLED
TO USE THE PROSPECTUS IN CONNECTION WITH THE RESALE OF NEW CAPITAL SECURITIES BY
THE NUMBER OF DAYS DURING THE PERIOD FROM AND INCLUDING THE DATE OF THE GIVING
OF SUCH NOTICE TO AND INCLUDING THE DATE WHEN PARTICIPATING BROKER-DEALERS SHALL
HAVE RECEIVED COPIES OF THE SUPPLEMENTED OR AMENDED PROSPECTUS NECESSARY TO
PERMIT RESALES OF THE NEW CAPITAL SECURITIES OR TO AND INCLUDING THE DATE ON
WHICH U. S. BANCORP OR THE TRUST HAS GIVEN NOTICE THAT SALES OF THE NEW CAPITAL
SECURITIES MAY BE RESUMED, AS THE CASE MAY BE.
AS A RESULT, A PARTICIPATING BROKER-DEALER WHO INTENDS TO USE
THE PROSPECTUS IN CONNECTION WITH RESALES OF NEW CAPITAL SECURITIES RECEIVED IN
EXCHANGE FOR OLD CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER MUST NOTIFY
U. S. BANCORP AND THE TRUST, OR CAUSE U. S. BANCORP AND THE TRUST TO BE
NOTIFIED, ON OR PRIOR TO THE EXPIRATION DATE, THAT IT IS A PARTICIPATING
BROKER-DEALER. SUCH NOTICE MAY BE GIVEN IN THE SPACE PROVIDED ABOVE OR MAY BE
DELIVERED TO THE EXCHANGE AGENT AT THE ADDRESS SET FORTH IN THE PROSPECTUS UNDER
"THE EXCHANGE OFFER--EXCHANGE AGENT."
Holders of Old Capital Securities whose Old Capital Securities
are accepted for exchange will not receive Distributions on such Old Capital
Securities and the undersigned waives the right to receive any Distributions on
such Old Capital Securities accumulated from and including June 15, 1997.
Accordingly, holders of New Capital
- 8 -
<PAGE>
Securities as of the record date for the payment of Distributions on December
15, 1997 will be entitled to Distributions accumulated from and including June
15, 1997.
The undersigned will, upon request, execute and deliver any
additional documents deemed by U. S. Bancorp or the Trust to be necessary or
desirable to complete the sale, assignment and transfer of the Old Capital
Securities tendered hereby. All authority herein conferred or agreed to be
conferred in this Letter of Transmittal shall survive the death or incapacity of
the undersigned and any obligation of the undersigned hereunder shall be binding
upon the heirs, executors, administrators, personal representatives, trustees in
bankruptcy, legal representatives, successors and assigns of the undersigned.
Except as stated in the Prospectus, this tender is irrevocable.
THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION
OF OLD CAPITAL SECURITIES" ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE
TENDERED THE OLD CAPITAL SECURITIES AS SET FORTH IN SUCH BOX.
HOLDER(S) SIGN HERE
(SEE INSTRUCTIONS 2, 5, AND 6)
(PLEASE COMPLETE SUBSTITUTE FORM W-9 ON PAGE __)
(NOTE: SIGNATURE(S) MUST BE GUARANTEED IF REQUIRED BY
INSTRUCTION 2)
Must be signed by registered holder(s) exactly as name(s)
appear(s) on Certificate(s) for the Old Capital Securities hereby tendered or on
the register of holders maintained by the Trust, or by any person(s) authorized
to become the registered holder(s) by endorsements and documents transmitted
herewith (including such opinions of counsel, certifications and other
information as may be required by the Trust or the Trustee for the Old Capital
Securities to comply with the restrictions on transfer applicable to the Old
Capital Securities). If signature is by an attorney-in-fact, executor,
administrator, trustee, guardian, officer of a corporation or another acting in
a fiduciary capacity or representative capacity, please set forth the signer's
full title. See Instruction 5.
(SIGNATURE(S) OF HOLDER(S))
Date: , 1997
Name(s)
(PLEASE PRINT)
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<PAGE>
Capacity (full title)
Address
(INCLUDE ZIP CODE)
Area Code and Telephone Number
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 2 AND 5)
(AUTHORIZED SIGNATURE)
Date: , 1997
Name of Firm
Capacity (full title)
(PLEASE PRINT)
Address
(INCLUDE ZIP CODE)
Area Code and Telephone Number
SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if New Capital Securities or Old Capital Securities not
tendered are to be issued in the name of someone other than the registered
holder of the Old Capital Securities whose name(s) appear(s) above.
- 10 -
<PAGE>
Issue
Old Capital Securities not tendered to:
New Capital Securities to:
Name(s)
Address
(INCLUDE ZIP CODE)
Area Code and Telephone Number
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if New Capital Securities or Old Capital Securities not
tendered are to be sent to someone other than the registered holder of the Old
Capital Securities whose name(s) appear(s) above, or to such registered
holder(s) at an address other than that shown above.
Mail
Old Capital Securities not tendered to:
New Capital Securities to:
Name(s)
Address
(INCLUDE ZIP CODE)
Area Code and Telephone Number
- 11 -
<PAGE>
- --------------------------------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES;
GUARANTEED DELIVERY PROCEDURES. This Letter of Transmittal is to be completed
either if (a) Certificates are to be forwarded herewith or (b) tenders are to be
made pursuant to the procedures for tender by book-entry transfer set forth
under "The Exchange Offer--Procedures for Tendering Old Capital Securities" in
the Prospectus and an Agent's Message is not delivered. Certificates, or timely
confirmation of a book-entry transfer of such Old Capital Securities into the
Exchange Agent's account at DTC, as well as this Letter of Transmittal (or
facsimile thereof), properly completed and duly executed, with any required
signature guarantees, or an Agent's Message in lieu of this Letter of
Transmittal, and any other documents required by this Letter of Transmittal,
must be received by the Exchange Agent at its address set forth herein on or
prior to the Expiration Date; provided, however, that book-entry transfers of
Old Capital Securities may be effected in accordance with the procedures
mandated by DTC's Automated Tender Offer Program ("ATOP"). Old Capital
Securities may be tendered in whole or in part in a Liquidation Amount of
$100,000 (100 Capital Securities) or any integral multiple of $1,000 (one
Capital Security) in excess thereof; provided that, if any Old Capital
Securities are tendered for exchange in part, the untendered Liquidation Amount
thereof must be $100,000 (100 Capital Securities) or any integral multiple of
$1,000 (one Capital Security) in excess thereof.
Holders who wish to tender their Old Capital Securities and
(i) whose Old Capital Securities are not immediately available or (ii) who
cannot deliver their Old Capital Securities, this Letter of Transmittal and all
other required documents to the Exchange Agent on or prior to the Expiration
Date, or (iii) who cannot complete the procedures for delivery by book-entry
transfer on a timely basis, may tender their Old Capital Securities by properly
completing and duly executing a Notice of Guaranteed Delivery pursuant to the
guaranteed delivery procedures set forth in "The Exchange Offer--Procedures for
Tendering Old Capital Securities" in the Prospectus. Pursuant to such
procedures: (i) such tender must be made by or through an Eligible Institution
(as defined below); (ii) a properly completed and duly executed Notice of
Guaranteed Delivery, substantially in the form made available by the Trust, must
be received by the Exchange Agent on or prior to the Expiration Date; and (iii)
the Certificates (or a book-entry confirmation (as defined in this Prospectus))
representing all tendered Old Capital Securities, in proper form for transfer,
together with a Letter of Transmittal (or facsimile thereof), properly completed
and duly executed, with any required signature guarantees and any other
documents required by this Letter of Transmittal, must be received by the
Exchange Agent within three New York Stock Exchange, Inc. trading days after the
date of execution of such Notice of Guaranteed Delivery, all as
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<PAGE>
provided in "The Exchange Offer--Procedures for Tendering Old Capital
Securities" in the Prospectus.
The Notice of Guaranteed Delivery may be delivered by hand or
transmitted by facsimile or mail to the Exchange Agent, and must include a
guarantee by an Eligible Institution in the form set forth in such Notice. For
Old Capital Securities to be properly tendered pursuant to the guaranteed
delivery procedure, the Exchange Agent must receive a Notice of Guaranteed
Delivery on or prior to the Expiration Date. As used herein and in the
Prospectus, "Eligible Institution" means a firm or other entity identified in
Rule 17Ad-15 under the Exchange Act as "an eligible guarantor institution,"
including (as such terms are defined therein) (i) a bank; (ii) a broker, dealer,
municipal securities broker or dealer or government securities broker or dealer;
(iii) a credit union; (iv) a national securities exchange, registered securities
association or clearing agency; or (v) a savings association that is a
participant in a Securities Transfer Association.
THE METHOD OF DELIVERY OF CERTIFICATES, THIS LETTER OF
TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF
THE TENDERING HOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY
RECEIVED BY THE EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY
DELIVERY.
Neither U. S. Bancorp nor the Trust will accept any
alternative, conditional or contingent tenders. Each tendering holder, by
execution of a Letter of Transmittal (or facsimile thereof) or delivery of an
Agent's Message in lieu thereof, waives any right to receive any notice of the
acceptance of such tender.
2. GUARANTEE OF SIGNATURES. No signature guarantee on this
Letter of Transmittal is required if:
(i) this Letter of Transmittal is signed by the registered
holder (which term, for purposes of this document, shall include any participant
in DTC whose name appears on a security position listing as the owner of the Old
Capital Securities) of Old Capital Securities tendered herewith, unless such
holder(s) has completed either the box entitled "Special Issuance Instructions"
or the box entitled "Special Delivery Instructions" above, or
(ii) such Old Capital Securities are tendered for the account
of a firm that is an Eligible Institution.
In all other cases, an Eligible Institution must guarantee the
signature(s) on this Letter of Transmittal. See Instruction 5.
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<PAGE>
3. INADEQUATE SPACE. If the space provided in the box
captioned "Description of Old Capital Securities" is inadequate, the Certificate
number(s) and/or the Liquidation Amount of Old Capital Securities and any other
required information should be listed on a separate signed schedule which is
attached to this Letter of Transmittal.
4. PARTIAL TENDERS AND WITHDRAWAL RIGHTS. Tenders of Old
Capital Securities will be accepted only in the Liquidation Amount of $100,000
(100 Capital Securities) and integral multiples of $1,000 in excess thereof;
provided that if any Old Capital Securities are tendered for exchange in part,
the untendered Liquidation Amount thereof must be $100,000 (100 Capital
Securities) or any integral multiple of $1,000 in excess thereof. If less than
all the Old Capital Securities evidenced by any Certificate submitted are to be
tendered, fill in the Liquidation Amount of Old Capital Securities which are to
be tendered in the box entitled "Liquidation Amount of Old Capital Securities
Tendered." In such case, new Certificate(s) for the remainder of the Old Capital
Securities that were evidenced by your old Certificate(s) will be sent to the
holder of the Old Capital Securities promptly after the Expiration Date. All Old
Capital Securities represented by Certificates delivered to the Exchange Agent
will be deemed to have been tendered unless otherwise indicated.
Except as otherwise provided herein, tenders of Old Capital
Securities may be withdrawn at any time on or prior to the Expiration Date. In
order for a withdrawal to be effective on or prior to that time, a written,
telegraphic, telex or facsimile transmission of such notice of withdrawal must
be timely received by the Exchange Agent at one of its addresses set forth above
or in the Prospectus on or prior to the Expiration Date. Any such notice of
withdrawal must specify the name of the person who tendered the Old Capital
Securities to be withdrawn, the aggregate Liquidation Amount of Old Capital
Securities to be withdrawn, and (if Certificates for Old Capital Securities have
been tendered) the name of the registered holder of the Old Capital Securities
as set forth on the Certificate for the Old Capital Securities, if different
from that of the person who tendered such Old Capital Securities. If
Certificates for the Old Capital Securities have been delivered or otherwise
identified to the Exchange Agent, then prior to the physical release of such
Certificates for the Old Capital Securities, the tendering holder must submit
the serial numbers shown on the particular Certificates for the Old Capital
Securities to be withdrawn and the signature on the notice of withdrawal must be
guaranteed by an Eligible Institution, except in the case of Old Capital
Securities tendered for the account of an Eligible Institution. If Old Capital
Securities have been tendered pursuant to the procedures for book-entry transfer
set forth in the Prospectus under "The Exchange Offer--Procedures for Tendering
Old Capital Securities," the notice of withdrawal must specify the name and
number of the account at DTC to be credited with the withdrawal of Old Capital
Securities, in which case a notice of withdrawal will be effective if delivered
to the Exchange Agent by written, telegraphic, telex or facsimile transmission.
Withdrawals of tenders of Old Capital Securities may not be rescinded. Old
Capital Securities properly withdrawn will not be deemed validly tendered for
purposes of the Exchange Offer, but may be retendered at any subsequent time on
or prior to the Expiration Date by following any of the procedures described in
the Prospectus under "The Exchange Offer--Procedures for Tendering Old Capital
Securities."
- 14 -
<PAGE>
All questions as to the validity, form and eligibility
(including time of receipt) of such withdrawal notices will be determined by U.
S. Bancorp and the Trust, in their sole discretion, whose determination shall be
final and binding on all parties. Neither U. S. Bancorp, the Trust, any
affiliates or assigns of U. S. Bancorp or the Trust, the Exchange Agent nor any
other person shall be under any duty to give any notification of any
irregularities in any notice of withdrawal or incur any liability for failure to
give any such notification. Any Old Capital Securities which have been tendered
but which are withdrawn will be returned to the holder thereof without cost to
such holder promptly after withdrawal.
5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND
ENDORSEMENTS. If this Letter of Transmittal is signed by the registered
holder(s) of the Old Capital Securities tendered hereby, the signature(s) must
correspond exactly with the name(s) as written on the face of the Certificate(s)
without alteration, enlargement or any change whatsoever.
If any of the Old Capital Securities tendered hereby are owned
of record by two or more joint owners, all such owners must sign this Letter of
Transmittal.
If any tendered Old Capital Securities are registered in
different name(s) on several Certificates, it will be necessary to complete,
sign and submit as many separate Letters of Transmittal (or facsimiles thereof)
as there are different registrations of Certificates.
If this Letter of Transmittal or any Certificates or bond
powers are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing and must
submit proper evidence satisfactory to U. S. Bancorp and the Trust, in their
sole discretion, of each such person's authority so to act.
When this Letter of Transmittal is signed by the registered
owner(s) of the Old Capital Securities listed and transmitted hereby, no
endorsement(s) of Certificate(s) or separate bond power(s) are required unless
New Capital Securities are to be issued in the name of a person other than the
registered holder(s). Signature(s) on such Certificate(s) or bond power(s) must
be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than
the registered owner(s) of the Old Capital Securities listed, the Certificates
must be endorsed or accompanied by appropriate bond powers, signed exactly as
the name or names of the registered owner(s) appear(s) on the Certificates, and
also must be accompanied by such opinions of counsel, certifications and other
information as U. S. Bancorp, the Trust or the Trustee for the Old Capital
Securities may require in accordance with the restrictions on transfer
applicable to the Old Capital Securities. Signatures on such Certificates or
bond powers must be guaranteed by an Eligible Institution.
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<PAGE>
6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. If New Capital
Securities are to be issued in the name of a person other than the signer of
this Letter of Transmittal, or if New Capital Securities are to be sent to
someone other than the signer of this Letter of Transmittal or to an address
other than that shown above, the appropriate boxes on this Letter of Transmittal
should be completed. Certificates for Old Capital Securities not exchanged will
be returned by mail or, if tendered by book-entry transfer, by crediting the
account indicated above maintained at DTC. See Instruction 4.
7. IRREGULARITIES. U. S. Bancorp and the Trust will determine,
in their sole discretion, all questions as to the form of documents, validity,
eligibility (including time of receipt) and acceptance for exchange of any
tender of Old Capital Securities, which determination shall be final and binding
on all parties. U. S. Bancorp and the Trust reserve the absolute right to reject
any and all tenders determined by either of them not to be in proper form or the
acceptance of which, or exchange for which, may, in the view of counsel to U. S.
Bancorp and the Trust, be unlawful. U. S. Bancorp and the Trust also reserve the
absolute right, subject to applicable law, to waive any of the conditions of the
Exchange Offer set forth in the Prospectus under "The Exchange Offer--Conditions
to the Exchange Offer" or any conditions or irregularity in any tender of Old
Capital Securities of any particular holder whether or not similar conditions or
irregularities are waived in the case of other holders. U. S. Bancorp's and the
Trust's interpretation of the terms and conditions of the Exchange Offer
(including this Letter of Transmittal and the instructions hereto) will be final
and binding. No tender of Old Capital Securities will be deemed to have been
validly made until all irregularities with respect to such tender have been
cured or waived. U. S. Bancorp, the Trust, any affiliates or assigns of U. S.
Bancorp or the Trust, the Exchange Agent, or any other person shall not be under
any duty to give notification of any irregularities in tenders or incur any
liability for failure to give such notification.
8. QUESTIONS, REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES.
Questions and requests for assistance may be directed to the Exchange Agent at
its address and telephone number set forth on the front of this Letter of
Transmittal. Additional copies of the Prospectus, the Notice of Guaranteed
Delivery and the Letter of Transmittal may be obtained from the Exchange Agent
or from your broker, dealer, commercial bank, trust company or other nominee.
9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S.
Federal income tax law, a holder whose tendered Old Capital Securities are
accepted for exchange is required to provide the Exchange Agent with such
holder's correct taxpayer identification number ("TIN") on Substitute Form W-9
below. If the Exchange Agent is not provided with the correct TIN, the Internal
Revenue Service (the "IRS") may subject the holder or other payee to a $50
penalty. In addition, payments to such holders or other payees with respect to
Old Capital Securities exchanged pursuant to the Exchange Offer may be subject
to 31% backup withholding.
The box in Part 2 of the Substitute Form W-9 may be checked if
the tendering holder has not been issued a TIN and has applied for a TIN or
intends to apply for a TIN in
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<PAGE>
the near future. If the box in Part 2 is checked, the holder or other payee must
also complete the Certificate of Awaiting Taxpayer Identification Number below
in order to avoid backup withholding. Notwithstanding that the box in Part 2 is
checked and the Certificate of Awaiting Taxpayer Identification Number is
completed, the Exchange Agent will withhold 31% of all payments made prior to
the time a properly certified TIN is provided to the Exchange Agent. The
Exchange Agent will retain such amounts withheld during the 60-day period
following the date of the Substitute Form W-9. If the holder furnishes the
Exchange Agent with its TIN within 60 days after the date of the Substitute Form
W-9, the amounts retained during the 60-day period will be remitted to the
holder and no further amounts shall be retained or withheld from payments made
to the holder thereafter. If, however, the holder has not provided the Exchange
Agent with its TIN within such 60-day period, amounts withheld will be remitted
to the IRS as backup withholding. In addition, 31% of all payments made
thereafter will be withheld and remitted to the IRS until a correct TIN is
provided.
The holder is required to give the Exchange Agent the TIN
(e.g., social security number or employer identification number) of the
registered owner of the Old Capital Securities or of the last transferee
appearing on the transfers attached to, or endorsed on, the Old Capital
Securities. If the Old Capital Securities are registered in more than one name
or are not in the name of the actual owner, consult the enclosed "Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9" for
additional guidance on which number to report.
Certain holders (including, among others, corporations,
financial institutions and certain foreign persons) may not be subject to these
backup withholding and reporting requirements. Such holders should nevertheless
complete the attached Substitute Form W-9 below, and write "exempt" on the face
thereof, to avoid possible erroneous backup withholding. A foreign person may
qualify as an exempt recipient by submitting a properly completed IRS Form W-8,
signed under penalties of perjury, attesting to that holder's exempt status.
Please consult the enclosed "Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9" for additional guidance on which
holders are exempt from backup withholding.
Backup withholding is not an additional U.S. Federal income
tax. Rather, the U.S. Federal income tax liability of a person subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained.
10. WAIVER OF CONDITIONS. U. S. Bancorp and the Trust reserve
the absolute right to waive satisfaction of any or all conditions enumerated in
the Prospectus.
11. NO CONDITIONAL TENDERS. No alternative, conditional or
contingent tenders will be accepted. All tendering holders of Old Capital
Securities, by execution of this Letter of Transmittal, shall waive any right to
receive notice of the acceptance of Old Capital Securities for exchange.
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<PAGE>
Neither U. S. Bancorp, the Trust, the Exchange Agent nor any
other person is obligated to give notice of any defect or irregularity with
respect to any tender of Old Capital Securities, nor shall any of them incur any
liability for failure to give any such notice.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any
Certificate(s) representing Old Capital Securities have been lost, destroyed or
stolen, the holder should promptly notify the Exchange Agent. The holder will
then be instructed as to the steps that must be taken in order to replace the
Certificate(s). This Letter of Transmittal and related documents cannot be
processed until the procedures for replacing lost, destroyed or stolen
Certificate(s) have been followed.
13. SECURITY TRANSFER TAXES. Holders who tender their Old
Capital Securities for exchange will not be obligated to pay any transfer taxes
in connection therewith. If, however, New Capital Securities are to be delivered
to, or are to be issued in the name of, any person other than the registered
holder of the Old Capital Securities tendered, or if a transfer tax is imposed
for any reason other than the exchange of Old Capital Securities in connection
with the Exchange Offer, then the amount of any such transfer tax (whether
imposed on the registered holder or any other person) will be payable by the
tendering holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the Letter of Transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF)
AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED
BY THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE.
TO BE COMPLETED BY ALL TENDERING SECURITYHOLDERS
(See Instruction 9)
PAYER'S NAME: THE FIRST NATIONAL BANK OF CHICAGO
SUBSTITUTE Part 1--PLEASE PROVIDE YOUR TIN:
FORM W-9 TIN ON THE LINE AT RIGHT
AND CERTIFY BY SIGNING ------------------------
AND DATING BELOW.
Social Security
Number or Employer
Identification Number
---------------------------------------------------------------
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<PAGE>
Department of
the Treasury
Internal Revenue Part 2-TIN Applied For
Service
Payer's Request CERTIFICATION-UNDER THE PENALTIES OF PERJURY, I
for Taxpayer CERTIFY THAT:
Identification
Number ("TIN") (1) the number shown on this form is my correct
and taxpayer identification number (or I am
Certification waiting for a number to be issued to me).
(2) I am not subject to backup withholding
either because (i) I am exempt from backup
withholding, (ii) I have not been notified
by the Internal Revenue Service ("IRS") that
I am subject to backup withholding as a
result of a failure to report all interest
or dividends, or (iii) the IRS has notified
me that I am no longer subject to backup
withholding, and
(3) any other information provided on this form
is true and correct.
Signature Date , 1997
You must cross out item (iii) in Part (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting
interest or dividends on your tax return and you have not been notified by the
IRS that you are no longer subject to backup withholding.
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY IN CERTAIN CIRCUMSTANCES
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY AMOUNTS PAID TO YOU PURSUANT TO THE
EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF
TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 2 OF
THE SUBSTITUTE FORM W-9
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<PAGE>
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer
identification number has not been issued to me, and either (1) I have mailed or
delivered an application to receive a taxpayer identification number to the
appropriate Internal Revenue Service Center or Social Security Administration
Office or (2) I intend to mail or deliver an application in the near future. I
understand that if I do not provide a taxpayer identification number by the time
of payment, 31% of all payments made to me on account of the New Capital
Securities shall be retained until I provide a taxpayer identification number to
the Exchange Agent and that, if I do not provide my taxpayer identification
number within 60 days, such retained amounts shall be remitted to the Internal
Revenue Service as backup withholding and 31% of all reportable payments made to
me thereafter will be withheld and remitted to the Internal Revenue Service
until I provide a taxpayer identification number.
Signature Date , 1997
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EXHIBIT 99.2
NOTICE OF GUARANTEED DELIVERY FOR TENDER OF
8.27% CAPITAL SECURITIES, SERIES B
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
OF
U. S. BANCORP CAPITAL I
FULLY AND UNCONDITIONALLY GUARANTEED BY
U. S. BANCORP
This Notice of Guaranteed Delivery, or one substantially
equivalent to this form, must be used to accept the Exchange Offer (as defined
below) if (i) certificates for the 8.27% Capital Securities, Series A (the "Old
Capital Securities") of the Trust (as defined below) are not immediately
available, (ii) Old Capital Securities, the Letter of Transmittal and all other
required documents cannot be delivered to The First National Bank of Chicago
(the "Exchange Agent") on or prior to the Expiration Date (as defined in the
Prospectus referred to below) or (iii) the procedures for delivery by book-entry
transfer cannot be completed on a timely basis. This Notice of Guaranteed
Delivery may be delivered by hand, overnight courier or mail, or transmitted by
facsimile transmission, to the Exchange Agent. See "The Exchange
Offer--Procedures for Tendering Old Capital Securities" in the Prospectus. In
addition, in order to utilize the guaranteed delivery procedure to tender Old
Capital Securities pursuant to the Exchange Offer, a completed, signed and dated
Letter of Transmittal relating to the Old Capital Securities (or facsimile
thereof) must also be received by the Exchange Agent within the time period
specified herein. Capitalized terms not defined herein have the meanings
assigned to them in the Prospectus.
The Exchange Agent For The Exchange Offer Is:
The First National Bank of Chicago
By Registered or Certified Mail, Facsimile Transmissions:
Hand or Overnight Delivery: (Eligible Institutions Only)
(212) 240-8938
The First National Bank of Chicago
c/o First Chicago Trust Company of New York
14 Wall Street
8th Floor, Window 2 Confirm By Telephone
New York, New York 10005 Or For Information:
Attn: Corporate Trust Administration (212) 240-8801
Delivery of this Notice of Guaranteed Delivery to an address
other than as set forth above or transmission of this Notice of Guaranteed
Delivery via facsimile to a number other than as set forth above will not
constitute a valid delivery.
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<PAGE>
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO
GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO
BE GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS THERETO, SUCH
SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE
SIGNATURE BOX ON THE LETTER OF TRANSMITTAL.
Ladies and Gentlemen:
The undersigned hereby tenders to U. S. Bancorp Capital I, a
Delaware statutory business trust (the "Trust") and to U. S. Bancorp, an Oregon
corporation, upon the terms and subject to the conditions set forth in the
Prospectus dated June ___, 1997 (as the same may be amended or supplemented from
time to time, the "Prospectus"), and the related Letter of Transmittal (which
together constitute the "Exchange Offer"), receipt of which is hereby
acknowledged, the aggregate Liquidation Amount of Old Capital Securities set
forth below pursuant to the guaranteed delivery procedures set forth in the
Prospectus under the caption "The Exchange Offer--Procedures for Tendering Old
Capital Securities."
Aggregate Liquidation Amount Name(s) of Registered Holder(s):______________
Amount Tendered: $______________*
Certificate No(s)
(if available): ______________
(Total Liquidation Amount
Represented by Old Capital
Securities Certificate(s)
$----------------------------
If Old Capital Securities will be tendered by book-entry transfer, provide the
following information:
DTC Account Number: ______________
Date:______________
* Must be in denominations of a Liquidation Amount of $1,000 and any
integral multiple thereof, and not less than $100,000 aggregate
Liquidation Amount.
All authority herein conferred or agreed to be conferred shall survive
the death or incapacity of the undersigned and every obligation of the
undersigned hereunder shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
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<PAGE>
PLEASE SIGN HERE
x------------------------------- --------------------------------
x------------------------------- --------------------------------
Signature(s) of Owner(s) Date:--------------------------------
or Authorized Signatory
Area Code and Telephone Number: ----------------------------
Must be signed by the holder(s) of the Old Capital Securities
as their name(s) appear(s) on certificates for Old Capital Securities or on a
security position listing, or by person(s) authorized to become registered
holder(s) by endorsement and documents transmitted with this Notice of
Guaranteed Delivery. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer or other person acting in a fiduciary or
representative capacity, such person must set forth his or her full title below.
Please print name(s) and address(es)
Name(s): --------------------------------
--------------------------------
--------------------------------
Capacity: --------------------------------
Address(es): --------------------------------
--------------------------------
--------------------------------
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm or other entity identified in Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended, as an "eligible
guarantor institution," including (as such terms are defined therein): (i) a
bank; (ii) a broker, dealer, municipal securities broker, municipal securities
dealer, government securities broker or government securities dealer; (iii) a
credit union; (iv) a national securities exchange, registered securities
association or clearing agency; or (v) a savings association that is a
participant in a Securities Transfer Association recognized program (each of the
foregoing being referred to as an "Eligible Institution"), hereby guarantees to
deliver to the Exchange Agent, at its address set forth above, either the Old
Capital Securities tendered hereby in proper form for transfer, or confirmation
of the book-entry transfer of such Old Capital Securities to the Exchange
Agent's account at The Depository Trust Company ("DTC"), pursuant to the
procedures for
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<PAGE>
book-entry transfer set forth in the Prospectus, in either case together with
one or more properly completed and duly executed Letter(s) of Transmittal (or
facsimile thereof) and any other required documents within three business days
after the date of execution of this Notice of Guaranteed Delivery.
The undersigned acknowledges that it must deliver the
Letter(s) of Transmittal and the Old Capital Securities tendered hereby to the
Exchange Agent within the time period set forth above and that failure to do so
could result in a financial loss to the undersigned.
Name of Firm Authorized Signature
Address Title
Zip Code (Please Type or Print)
Area Code and Telephone No. ____________________________ Dated:______________
NOTE: DO NOT SEND CERTIFICATES FOR OLD CAPITAL SECURITIES WITH THIS FORM.
CERTIFICATES FOR OLD CAPITAL SECURITIES SHOULD ONLY BE SENT WITH YOUR LETTER OF
TRANSMITTAL.
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EXCHANGE AGENT AGREEMENT
June __, 1997
The First National Bank of Chicago
Corporate Trust Administration
One N. State Street, 9th Floor
Chicago, Illinois 60602
Ladies and Gentlemen:
U. S. Bancorp Capital I, a statutory business trust created
under the laws of the State of Delaware (the "Trust") proposes to make an offer
(the "Exchange Offer") to exchange its 8.27% Capital Securities, Series A
(Liquidation Amount $1,000 per Capital Security) (the "Old Securities") for its
8.27% Capital Securities, Series B (Liquidation Amount $1,000 per Capital
Security) (the "New Securities"). All of the beneficial interests represented by
common securities of the Trust are owned by U. S. Bancorp, an Oregon
corporation. The terms and conditions of the Exchange Offer as currently
contemplated are set forth in a prospectus dated June ____, 1997 (the
"Prospectus"), to be distributed to all record holders of the Old Securities.
The Old Securities and the New Securities are collectively referred to herein as
the "Securities."
The Trust hereby appoints The First National Bank of Chicago
to act as exchange agent (the "Exchange Agent") in connection with the Exchange
Offer. References hereinafter to "you" shall refer to The First National Bank of
Chicago.
The Exchange Offer is expected to be commenced by the Trust on
or about June ____, 1997. The Letter of Transmittal accompanying the Prospectus
(or in the case of book entry securities, the ATOP system) is to be used by the
holders of the Old Securities to accept the Exchange Offer and contains
instructions with respect to (i) the delivery of certificates for Old Securities
tendered in connection therewith and (ii) the book entry transfer of Securities
to the Exchange Agent's account.
The Exchange Offer shall expire at 5:00 P.M., New York City
time on July ____, 1997 or on such later date or time to which the Trust may
extend the Exchange Offer (the "Expiration Date"). Subject to the terms and
conditions set forth in the Prospectus, the Trust expressly reserves the right
to extend the Exchange Offer from time to time by giving oral (to be confirmed
in writing) or written notice to you before 9:00 A.M., New York City time, on
the business day following the previously scheduled Expiration Date.
The Trust expressly reserves the right to amend or terminate
the Exchange Offer, and not to accept for exchange any Old Securities not
theretofore accepted for exchange, upon the occurrence of any of the conditions
to the Exchange Offer specified in the Prospectus under the caption "The
Exchange Offer--Conditions to the Exchange Offer."
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<PAGE>
The Trust will give oral (confirmed in writing) or written notice of any
amendment or termination of the Exchange Offer or nonacceptance of Old
Securities to you promptly after any amendment, termination or nonacceptance.
In carrying out your duties as Exchange Agent, you are to act
in accordance with the following instructions:
1. You will perform such duties and only such duties as are
specifically set forth in the section of the Prospectus captioned "The Exchange
Offer" or as specifically set forth herein; provided, however, that in no way
will your general duty to act in good faith be discharged by the foregoing.
2. You will establish an account with respect to the Old
Securities at The Depository Trust Company (the "Book-Entry Transfer Facility")
for purposes of the Exchange Offer within two business days after the date of
the Prospectus, and any financial institution that is a participant in the
Book-Entry Transfer Facility's system may make book-entry delivery of the Old
Securities by causing the Book-Entry Transfer Facility to transfer such Old
Securities into your account in accordance with the Book-Entry Transfer
Facility's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and
certificates for Old Securities (or confirmation of book-entry transfer into
your account at the Book-Entry Transfer Facility) and any other documents
delivered or mailed to you by or for holders of the Old Securities to ascertain
whether (i) the Letters of Transmittal and any such other documents are duly
executed and properly completed in accordance with instructions set forth
therein and (ii) the Old Securities have otherwise been properly tendered. In
each case where the Letter of Transmittal or any other document has been
improperly completed or executed or any of the certificates for Old Securities
are not in proper form for transfer or some other irregularity in connection
with the acceptance of the Exchange Offer exists, you will endeavor to inform
the presenters of the need for fulfillment of all requirements and to take any
other action as may be necessary or advisable to cause such irregularity to be
corrected.
4. With the approval of any Administrative Trustee of the
Trust or any person designated in writing by U. S. Bancorp (a "Designated
Officer") (such approval, if given orally, to be confirmed in writing) or any
other party designated by any such Administrative Trustee or Designated Officer
in writing, you are authorized to waive any irregularities in connection with
any tender of Old Securities pursuant to the Exchange Offer.
5. Tenders of Old Securities may be made only as set forth in
the Letter of Transmittal and in the section of the Prospectus captioned "The
Exchange Offer--Procedures for Tendering Old Capital Securities," and Old
Securities shall be considered properly tendered to you only when tendered in
accordance with the procedures set forth therein.
- 2 -
<PAGE>
Notwithstanding the provisions of this paragraph 5, Old
Securities which any Administrative Trustee of the Trust or Designated Officer
of U. S. Bancorp shall approve as having been properly tendered shall be
considered to be properly tendered (such approval, if given orally, shall be
confirmed in writing).
6. You shall advise the Trust and U. S. Bancorp with respect
to any Old Securities received subsequent to the Expiration Date and accept
their instructions with respect to disposition of such Old Securities.
7. You shall accept tenders:
(a) in cases where the Old Securities are registered in two or
more names only if signed by all named holders;
(b) in cases where the signing person (as indicated on the
Letter of Transmittal) is acting in a fiduciary or a representative capacity
only when proper evidence of such person's authority so to act is submitted; and
(c) from persons other than the registered holder of Old
Securities provided that customary transfer requirements, including any
applicable transfer taxes, are fulfilled.
You shall accept partial tenders of Old Securities where so
indicated and as permitted in the Letter of Transmittal and deliver certificates
for Old Securities to the transfer agent for split-up and return any untendered
Old Securities to the holder (or such other person as may be designated in the
Letter of Transmittal) as promptly as practicable after expiration or
termination of the Exchange Offer.
8. Upon satisfaction or waiver of all of the conditions to the
Exchange Offer, the Trust will notify you (such notice if given orally, to be
confirmed in writing) of its acceptance, promptly after the Expiration Date, of
all Old Securities properly tendered and you, on behalf of the Trust, will
exchange such Old Securities for New Securities and cause such Old Securities to
be canceled. Delivery of New Securities will be made on behalf of the Trust by
you at the rate of $1,000 Liquidation Amount of New Securities for each $1,000
Liquidation Amount of the Old Securities tendered promptly after notice (such
notice if given orally, to be confirmed in writing) of acceptance of said Old
Securities by the Trust; provided, however, that in all cases, Old Securities
tendered pursuant to the Exchange Offer will be exchanged only after timely
receipt by you of certification for such Old Securities (or confirmation of
book-entry transfer into your account at the Book-Entry Transfer Facility), a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof) with any required signature guarantees and any other required
documents. You shall issue New Securities only in minimum blocks of at least 100
(representing a minimum of $100,000 aggregate Liquidation Amount). Old
Securities may be tendered for exchange in whole or in part in a Liquidation
Amount of $100,000 and integral multiples of $1,000 in excess thereof; provided
that, if any Old Securities are tendered for exchange in part, the untendered
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<PAGE>
Liquidation Amount thereof must be $100,000 or any integral multiple of $1,000
in excess thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable,
except that, subject to the terms and upon the conditions set forth in the
Prospectus and the Letter of Transmittal, Old Securities tendered pursuant to
the Exchange Offer may be withdrawn at any time on or prior to the Expiration
Date.
10. The Trust shall not be required to exchange any Old
Securities tendered if any of the conditions set forth in the Exchange Offer are
not met. Notice of any decision by the Trust not to exchange any Old Securities
tendered shall be given orally (and confirmed in writing) by the Trust to you.
11. If, pursuant to the Exchange Offer, the Trust does not
accept for exchange all or part of the Old Securities tendered because of an
invalid tender, the occurrence of certain other events set forth in the
Prospectus under the caption "The Exchange Offer -- Conditions to the Exchange
Offer" or otherwise, you shall promptly after the expiration or termination of
the Exchange Offer return those certificates for unaccepted Old Securities (or
effect appropriate book-entry transfer) together with any related required
documents and the Letters of Transmittal relating thereto that are in your
possession, to the persons who deposited them.
12. All certificates for reissued Old Securities, unaccepted
Old Securities or for New Securities shall be forwarded by (a) first-class
certified mail, return receipt requested, under a blanket surety bond protecting
you and the Trust from loss or liability arising out of the non-receipt or
non-delivery of such certificates or (b) by registered mail insured separately
for the replacement value of each of such certificates.
13. You are not authorized to pay or offer to pay any
concessions, commissions or solicitation fees to any broker, dealer, bank or
other persons or to engage or utilize any person to solicit tenders.
14. As Exchange Agent hereunder you:
(a) shall have no duties or obligations other than
those specifically set forth in the section of the Prospectus captioned "The
Exchange Offer," the Letter of Transmittal or herein or as may be subsequently
agreed to in writing by you and the Trust;
(b) will be regarded as making no representations and
having no responsibilities as the validity, sufficiency, value or genuineness of
any of the certificates or the Old Securities represented thereby deposited with
you pursuant to the Exchange Offer, and will not be required to and will make no
representation as to the validity, value or genuineness of the Exchange Offer;
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<PAGE>
(c) shall not be obligated to take any legal action
hereunder which might in your reasonable judgment involve any expense or
liability, unless you shall have been furnished with reasonable indemnity;
(d) may reasonably rely on and shall be protected in
acting in reliance upon any certificate, instrument, opinion, notice, letter,
telegram or other document or security delivered to you and reasonably believed
by you to be genuine and to have been signed by the proper party or parties;
(e) may reasonably act upon any tender, statement,
request, agreement or other instrument whatsoever not only as to its due
execution and validity and effectiveness of its provisions, but also as to the
truth and accuracy of any information contained therein, which you shall in good
faith believe to be genuine or to have been signed or represented by a proper
person or persons;
(f) may rely on and shall be protected in acting upon
written or oral instructions from any Administrative Trustee of the Trust or
from any Designated Officer of U. S. Bancorp;
(g) may consult with your counsel with respect to any
questions relating to your duties and responsibilities and the advice or opinion
of such counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted to be taken by you hereunder in
good faith and in accordance with the advice or opinion of such counsel; and
(h) shall not advise any person tendering Old
Securities pursuant to the Exchange Offer as to the wisdom of making such tender
or as to the market value or decline or appreciation in market value of any Old
Securities.
15. You shall take such action as may from time to time be
requested by the Trust or its counsel or any Designated Officer of U. S. Bancorp
(and such other action as you reasonably deem appropriate) to furnish copies of
the Prospectus, Letter of Transmittal and the Notice of Guaranteed Delivery (as
defined in the Prospectus) or such other forms as may be approved from time to
time by the Trust or U. S. Bancorp, to all persons requesting such documents and
to accept and comply with telephone requests for information relating to the
Exchange Offer, provided that such information shall relate only to the
procedures for accepting (or withdrawing from) the Exchange Offer. The Trust
will furnish you with copies of such documents at your request. All other
requests for information relating to the Exchange Offer shall be directed to the
Trust, Attention: William R. Basom.
16. You shall advise by facsimile transmission or telephone,
and promptly thereafter confirm in writing to William R. Basom, Administrative
Trustee of the Trust, and such other person or persons as the Trust or U. S.
Bancorp may request, daily (and more frequently during the week immediately
preceding the Expiration Date and if otherwise requested) up to and including
the Expiration Date, as to the number of Old Securities which
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<PAGE>
have been tendered pursuant to the Exchange Offer and the items received by you
pursuant to this Agreement, separately reporting and giving cumulative totals as
to items properly received and items improperly received. In addition, you will
also inform, and cooperate in making available to, the Trust or U. S. Bancorp or
any such other person or persons upon oral request made from time to time on or
prior to the Expiration Date of such other information as it or such person
reasonably requests. Such cooperation shall include, without limitation, the
granting by you to the Trust or U. S. Bancorp and such person as the Trust or U.
S. Bancorp may request of access to those persons on your staff who are
responsible for receiving tenders, in order to ensure that immediately prior to
the Expiration Date the Trust or U. S. Bancorp shall have received information
in sufficient detail to enable it to decide whether to extend the Exchange
Offer. You shall prepare a final list of all persons whose tenders were
accepted, the aggregate Liquidation Amount of Old Securities tendered, and the
aggregate Liquidation Amount of Old Securities accepted and deliver said list to
the Trust promptly after the Expiration Date.
17. Letters of Transmittal and Notices of Guaranteed Delivery
shall be stamped by you as to the date and the time of receipt thereof and shall
be preserved by you for a period of time at least equal to the period of time
you preserve other records pertaining to the transfer of securities. You shall
dispose of unused Letters of Transmittal and other surplus materials by
returning them to the Trust at the address set forth below for notices.
18. You hereby expressly waive any lien, encumbrance or right
of set-off whatsoever that you may have with respect to funds deposited with you
for the payment of transfer taxes by reasons of amounts, if any, borrowed by the
Trust, or any of its subsidiaries or affiliates pursuant to any loan or credit
agreement with you or for compensation owed to you hereunder.
19. For services rendered as Exchange Agent hereunder, you
shall be entitled to such compensation as set forth on Schedule I attached
hereto.
20. You hereby acknowledge receipt of the Prospectus and the
Letter of Transmittal and further acknowledge that you have examined each of
them. Any inconsistency between this Agreement, on the one hand, and the
Prospectus and the Letter of Transmittal (as they may be amended from time to
time), on the other hand, shall be resolved in favor of the latter two
documents, except with respect to the duties, liabilities and indemnification of
you as Exchange Agent, which shall be controlled by this Agreement.
21. (a) The Trust covenants and agrees to indemnify and hold
you harmless in your capacity as Exchange Agent hereunder against any loss,
liability, cost or expense, including reasonable attorneys' fees and expenses,
arising out of or in connection with any act, omission, delay or refusal made by
you in reliance upon any signature, endorsement, assignment, certificate, order,
request, notice, instruction or other instrument or document reasonably believed
by you to be valid, genuine and sufficient and in accepting any tender or
effecting any transfer of Old Securities reasonably believed by you in good
faith to be authorized, and in delaying or refusing in good faith to accept any
tenders or
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effect any transfer of Old Securities; provided, however, that the Trust shall
not be liable for indemnification or otherwise for any loss, liability, cost or
expense to the extent arising out of your gross negligence or willful
misconduct. In no case shall the Trust be liable under this indemnity with
respect to any claim against you unless the Trust shall be notified by you, by
letter or cable or by facsimile confirmed by letter, of the written assertion of
a claim against you or of any other action commenced against you, promptly after
you shall have received any such written assertion or notice of commencement of
action. The Trust shall be entitled to participate at its own expense in the
defense of any such claim or other action, and, if the Trust so elects, the
Trust may assume the defense of any suit brought to enforce any such claim. In
the event that the Trust shall assume the defense of any such suit or threatened
action in respect of which indemnification may be sought hereunder, the Trust
shall not be liable for the fees and expenses of any additional counsel
thereafter retained by you so long as you consent to the Trust's retention of
counsel, which consent may not be unreasonably withheld; provided that the Trust
shall not be entitled to assume the defense of any such action if the named
parties to such action include both the Trust and you and representation of both
parties by the same legal counsel would, in the written opinion of counsel to
you, be inappropriate due to actual or potential conflicting interests between
them. It is understood that the Trust shall not be liable under this paragraph
for the fees and expenses of more than one legal counsel for you. In the event
that the Trust shall assume the defense of any such suit, the Trust shall not
thereafter be liable for the fees and expenses of any counsel retained by you.
(b) You agree that, without prior written consent of the Trust
(which consent shall not be unreasonably withheld), you will not settle,
compromise or consent to the entry of any pending or threatened claim, action,
or proceeding in respect of which indemnification could be sought in accordance
with the indemnification provisions of this Agreement (whether or not you or the
Trust or any of its trustees or controlling persons is an actual or potential
party to such claim, action or proceeding), unless such settlement, compromise
or consent includes an unconditional release of the Trust and its trustees and
controlling persons from all liability arising out of such claim, action or
proceeding.
22. You shall arrange to comply with all requirements under
the tax laws of the United States, including those relating to missing Taxpayer
Identification Numbers, and shall file any appropriate reports with the Internal
Revenue Service. The Trust understands that you are required in certain
instances to deduct 31% of distributions made with respect to the New Securities
and proceeds from the sale, exchange, redemption or retirement of the New
Securities from holders who have not supplied their correct Taxpayer
Identification Number or required certification. Such funds will be turned over
to the Internal Revenue Service in accordance with applicable regulations.
23. You shall notify the Trust of the amount of any transfer
taxes payable in respect of the exchange of Old Securities and, upon receipt of
written approval from the Trust, you shall deliver or cause to be delivered, in
a timely manner to each governmental authority to which any transfer taxes are
payable in respect of the exchange of Old Securities, your check in the amount
of all transfer taxes so payable, and the Trust shall
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reimburse you for the amount of any and all transfer taxes payable in respect of
the exchange of Old Securities; provided, however, that you shall reimburse the
Trust for amounts refunded to you in respect of your payment of any such
transfer taxes, at such time as such refund is received by you.
24. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
25. In case any provision of this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
26. This Agreement shall not be deemed or construed to be
modified, amended, rescinded, canceled or waived, in whole or in part, except by
a written instrument signed by a duly authorized representative of the party to
be charged. This Agreement may not be modified orally.
27. Unless otherwise provided herein, all notices, requests
and other communications to any party hereunder shall be in writing (including
facsimile or similar writing) and shall be given to such party, addressed to it,
at its address or telecopy number set forth below:
If to the Trust:
U. S. Bancorp Capital I
c/o U. S. Bancorp
111 S.W. Fifth Avenue
Portland, Oregon 97204
Facsimile: (503) 275-5032
Attention: William R. Basom
If to the Exchange Agent:
The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, Illinois 60670-0126
Facsimile: (312) 407-1708
Attention: Richard C. Tarnas
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28. Unless terminated earlier by the parties hereto, this
Agreement shall terminate 90 days following the Expiration Date. Notwithstanding
the foregoing, Paragraphs 19, 21, and 23 shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall promptly deliver to
the Trust any certificates for Securities, funds or property then held by you as
Exchange Agent under this Agreement.
29. This Agreement shall be binding and effective as of the
date hereof.
Please acknowledge receipt of this Agreement and confirm the
arrangements herein provided by signing and returning the enclosed copy.
U. S. BANCORP CAPITAL I
By:
Name: William R. Basom
Title: Administrative Trustee
Accepted as the date first above written:
THE FIRST NATIONAL BANK OF CHICAGO, AS EXCHANGE AGENT
By:
Name:
Title:
SCHEDULE I
FEES
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