UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
First Bank System, Inc.
(Name of Issuer)
Common Stock, Par Value $1.25 Per Share
(Title of Class of Securities)
319279105
(CUSIP Number)
Dwight V. Board, Esq.
Executive Vice President, General Counsel and Secretary
U. S. Bancorp
111 S.W. Fifth Avenue
Portland, Oregon 97204
(503) 275-6111
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
March 20, 1997
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Sched-
ule 13G to report the acquisition which is the subject of this
Schedule 13D, and is filing this schedule because of Rule 13d--
1(b)(3) or (4), check the following box: [__]<PAGE>
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
U. S. Bancorp
I.R.S. Identification No. 93-0571730
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [__]
(b) [__]
3. SEC USE ONLY
4. SOURCE OF FUNDS
WC, OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [__]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Oregon
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
7. SOLE VOTING POWER
26,556,470 shares (1) (See Item 5)
8. SHARED VOTING POWER
0
9. SOLE DISPOSITIVE POWER
26,556,470 shares (1) (See Item 5)
10. SHARED DISPOSITIVE POWER
0
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PER-
SON
26,577,054 shares (1) (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [__]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.6% (2)
14. TYPE OF REPORTING PERSON
HC, CO
(1) The reporting person disclaims beneficial ownership
of all such shares pursuant to Rule 13d-4 under the Securities
Exchange Act of 1934, as amended. Beneficial ownership of
26,551,018 of such shares is being reported hereunder solely as
a result of the option (the "Option") granted pursuant to the
FBS Stock Option Agreement described in Item 4 hereof. U. S.
Bancorp expressly disclaims any beneficial ownership of such
shares of FBS Common Stock which are obtainable by U. S. Ban-
corp upon exercise of the Option because the Option is exercis-
able only in the circumstances set forth in Item 4, none of
which has occurred as of the date hereof. U. S. Bancorp ex-
pressly disclaims any beneficial ownership of the remaining
26,036 shares of FBS Common Stock which are held in a fiduciary
capacity by certain subsidiaries of U. S. Bancorp.
(2) Gives effect to the issuance of FBS Common Stock sub-
ject to the Option.
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Item 1. Security and Issuer
This statement relates to shares of common stock, par
value $1.25 per share (the "FBS Common Stock"), of First Bank
System, Inc. ("FBS"). The address of FBS's principal executive
offices is First Bank Place, 601 Second Avenue South, Min-
neapolis Minnesota 55402.
Item 2. Identity and Background
(a) - (c) and (f). This Schedule 13D is being filed by
U. S. Bancorp ("USBC"), a corporation organized and existing
under the laws of the State of Oregon and registered as a bank
holding company under the Bank Holding Company Act of 1956, as
amended. U. S. Bancorp is engaged, through its banking subsid-
iaries and various banking-related subsidiaries, in a broad
range of banking operations and banking related business--
principally in the states of Oregon, Washington, California,
Nevada, Idaho, and Utah. U. S. Bancorp's principal offices are
located at 111 S.W. Fifth Avenue, Portland, Oregon 97204.
Each executive officer and each director of U. S. Bancorp
is a citizen of the United States. The name, business address,
and present principal occupation of each executive officer and
director is set forth in Annex A to this Schedule 13D and spe-
cifically incorporated herein by reference.
Other than executive officers and directors, there are no
persons or corporations controlling or ultimately in control of
U. S. Bancorp.
(d) - (e). During the last five years, neither USBC nor,
to the best knowledge of USBC, any executive officer or direc-
tor of USBC, has been (i) convicted in a criminal proceeding
(excluding traffic violations and similar misdemeanors) or (ii)
a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such proceed-
ing has been or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or
finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
Pursuant to the FBS Stock Option Agreement described in
Item 4 (the "FBS Stock Option Agreement"), FBS has granted to
USBC an option (the "Option") to purchase up to 26,551,018
shares of FBS Common Stock at a price of $77.50 per share, ex-
ercisable only upon the occurrence of certain events. The ex-
ercise of the Option to purchase the full number of shares of
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FBS Common Stock currently covered thereby would require ag-
gregate funds of $2,057,703,895. If USBC were to purchase
shares of FBS Common Stock pursuant to the FBS Stock Option
Agreement, USBC currently anticipates that such funds would be
provided from USBC's working capital, dividends from USBC sub-
sidiaries and by borrowings from other sources yet to be deter-
mined.
Item 4. Purpose of Transaction
On March 19, 1997, FBS and USBC entered into an Agreement
and Plan of Merger (the "Merger Agreement"), pursuant to which
USBC will be merged with and into FBS (the "Merger"). FBS will
change its name to "U. S. Bancorp" upon consummation of the
Merger.
As a result of the Merger, each outstanding share of USBC
Common Stock (excluding treasury and certain other shares) will
be converted into 0.755 shares of common stock of FBS ("FBS
Common Stock"). Each outstanding share of 8-1/8% cumulative
preferred stock, Series A ("USBC Preferred Stock"), of USBC
will be converted into one share of preferred stock of FBS with
substantially identical terms as the USBC Preferred Stock which
is converted. Consummation of the Merger would result in the
USBC Common Stock and the USBC Preferred Stock ceasing to be
authorized to be quoted on the Nasdaq Stock Market, Inc.'s Na-
tional Market System ("NASDAQ") and the termination of regis-
tration of such securities pursuant to the Act.
The Merger will be a tax-free reorganization and will be
accounted for as a pooling of interests. The Merger is subject
to a number of conditions set forth in the Merger Agreement.
The Merger Agreement is included as Exhibit 2.1 to USBC's
Current Report on Form 8-K dated March 19, 1997 (the "USBC 8-K")
and is hereby incorporated herein by reference.
As a condition and inducement to USBC's entering into the
Merger Agreement (and a reciprocal stock option agreement), FBS
entered into the FBS Stock Option Agreement with FBS. Pursuant
to the FBS Stock Option Agreement, FBS has granted to USBC an
option to purchase up to 26,551,018 shares (the "Option
Shares") of FBS Common Stock at a price of $77.50 per share,
exercisable only upon the occurrence of certain events. Under
the FBS Stock Option Agreement, the Total Profit (as defined)
which USBC, as grantee of the Option, may realize from the Op-
tion may not exceed $300 million. Under certain circumstances
set forth in the FBS Stock Option Agreement, USBC, as grantee
of the Option, may surrender the Option to FBS in exchange for
a payment of $200 million. The FBS Stock Option Agreement is
included as Exhibit 99.2 to the USBC 8-K and is hereby
incorporated herein by reference.
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Pursuant to the Merger Agreement, upon consummation of the
Merger, FBS will cause all current members of the U. S. Bancorp
Board of Directors who remain directors and are willing to
serve to be elected or appointed as directors of FBS, subject
to the following. The Restated Certificate of Incorporation of
FBS (the "FBS Certificate") currently provides for a maximum
number of 24 directors. Appointing or electing each current
member of the U. S. Bancorp Board of Directors to the FBS Board
of Directors would cause the total number of directors to ex-
ceed 24. Accordingly, FBS has, in the Merger Agreement, agreed
to seek approval of FBS stockholders to amend the FBS Certifi-
cate to provide that the maximum number of directors shall be
30. Pursuant to the FBS Certificate, the affirmative vote of
the holders of at least 80% of the outstanding FBS Common Stock
entitled to vote thereon is required to approve such amendment.
FBS has agreed to use all reasonable efforts to solicit such
vote, which would permit each of the current U. S. Bancorp di-
rectors to be appointed or elected to the FBS Board of Direc-
tors. The Merger Agreement provides that, should the FBS
stockholders fail to approve such amendment to the FBS Certifi-
cate, FBS will appoint or elect to the FBS Board of Directors
the maximum number of U. S. Bancorp directors as would result
in there being 24 members of the FBS Board of Directors (but in
no event fewer than 10 U. S. Bancorp directors), and FBS would
appoint the U. S. Bancorp director not so appointed or elected
as an advisory director of the FBS Board of Directors. The
parties intend to reduce the number of directors of the surviv-
ing corporation as of the first annual meeting of stockholders
thereof following the consummation of the Merger, provided
that, until at least the third such annual meeting, former
U. S. Bancorp directors shall constitute between 40% and 45% of
the total number of directors of the surviving corporation.
Pursuant to the Merger Agreement, the parties have agreed
that Gerry B. Cameron, Chairman of the Board, President and
Chief Executive Officer of U. S. Bancorp, will be Chairman of
the Board of Directors of FBS until December 31, 1998 and that
Gary T. Duim, Executive Vice President of U. S. Bancorp, and
Robert D. Sznewajs, Vice Chairman of U. S. Bancorp, shall each
be a Vice Chairman of the surviving corporation.
Pursuant to the Merger Agreement, FBS has agreed, during
the period prior to the Effective Time, that neither it nor its
subsidiaries shall pay dividends except for quarterly cash
dividends on FBS Common Stock not in excess of $0.465 per share
and certain intercompany dividends.
Except as set forth in this Item 4, USBC has no plans or
proposals which relate to or would result in any of the matters
set forth in clauses (a) through (j) of Item 4 of Schedule 13D.
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The preceding summary of certain provisions of the Merger
Agreement and the FBS Stock Option Agreement, copies of which
are filed as exhibits hereto, is not intended to be complete
and is qualified in its entirety by reference to the full text
of such agreements.
Item 5. Interest in Securities of the Issuer
(a) and (b). Pursuant to the FBS Stock Option Agreement,
USBC has the right, exercisable only in certain circumstances,
none of which have occurred as of the date hereof, to acquire
up to 26,551,018 shares of FBS Common Stock, which represents
beneficial ownership of approximately 19.9% of the shares of
FBS Common Stock currently outstanding. If USBC were to ac-
quire such shares, it would have sole voting and, subject to
certain restrictions set forth in the FBS Stock Option Agree-
ment, investment power with respect thereto. Because of the
limited circumstances in which the option granted under the FBS
Option Agreement is exercisable, USBC disclaims beneficial own-
ership of such shares of FBS Common Stock subject to the FBS
Stock Option Agreement.
As of December 31, 1996, certain USBC subsidiaries may be
deemed to be the beneficial owners of 26,036 shares of FBS Com-
mon Stock, which shares are held in a fiduciary capacity (the
"Fiduciary Shares"). USBC has sole voting power with respect
to 5,452 of such Fiduciary Shares, shared voting power with
respect to no such Fiduciary Shares, sole investment power as
to 5,452 of such Fiduciary Shares and shared investment power
with respect to no such Fiduciary Shares. The Option Shares
and the Fiduciary Shares collectively represent approximately
16.6% of the outstanding shares of FBS Common Stock giving ef-
fect to the full exercise of the Option. FBS disclaims benefi-
cial ownership of all of the Option Shares and all of the Fidu-
ciary Shares.
To the best of its knowledge, no executive officer or di-
rector of USBC beneficially owns any shares of FBS Common
Stock.
(c) Except to the extent of transactions in a fiduciary
capacity, there have been no transactions in shares of FBS Com-
mon Stock by USBC, or, to the best knowledge of USBC, any of
USBC's executive officers and directors during the past 60
days.
(d) As described in paragraph (a) and (b) above, USBC and
various subsidiaries of USBC may be deemed to be beneficial
owners of shares of FBS Common Stock in trust accounts for cus-
tomers with sole or no investment powers. The beneficiaries of
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such trust accounts have the power to direct the payment of
dividends and proceeds from the sale of such shares.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relation-
ships with Respect to Securities of the Issuer
A copy of the FBS Stock Option Agreement is included
as Exhibit 99.2 to the USBC 8-K and is hereby incorporated
herein by reference. The rights and obligations of FBS and
USBC under the FBS Stock Option Agreement are subject to all
required regulatory approvals.
A copy of the Merger Agreement is included as Exhibit
2.1 to the USBC 8-K and is hereby incorporated herein by refer-
ence.
Except as set forth in Items 3, 4, 5 and 6 neither
USBC nor, to the best knowledge of USBC, any of its directors
or executive officers, has any contracts, arrangements, under-
standings or relationships (legal or otherwise) with any other
person with respect to any securities of FBS.
Item 7. Materials to be Filed as Exhibits
2.1 Agreement and Plan of Merger, dated as of March 19,
1997, by and between U. S. Bancorp and First Bank
System, Inc. (incorporated by reference to Exhibit
2.1 of the USBC 8-K).
99.1 Stock Option Agreement, dated as of March 20, 1997,
by and between First Bank System, Inc., as issuer,
and U. S. Bancorp., as grantee (incorporated by ref-
erence to Exhibit 99.2 of the USBC 8-K).
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SIGNATURE
After reasonable inquiry and to the best of its knowledge
and belief, the undersigned certifies that the information set
forth in this statement is true, complete and correct.
March 28, 1997
U. S. BANCORP
/s/ Dwight V. Board
Dwight V. Board
Executive Vice President,
General Counsel and Secretary
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ANNEX A
Identity and Background
The following table sets forth the names, addresses and
principal occupations of the executive officers and directors
of USBC. Except as set forth below, the principal business ad-
dress of each such director and executive officer is the ad-
dress of USBC, 111 S.W. Fifth Avenue, Portland, Oregon 97204.
Each of such directors and executive officers is a citizen of
the United States.
DIRECTORS
Name and Business Address Present Principal Occupation or Employment
Harry Bettis Rancher
10775 Sucker Creek Road
Payette, Idaho 83661
Gerry B. Cameron Chairman of the Board, President and
Chief Executive Officer, U. S. Bancorp
Carolyn Silva Chambers Chairwoman and Chief Executive Officer,
2225 Coburg Road Chambers Communications Corp.
Post Office Box 7009 (a broadcast and television company);
Eugene, Oregon 97401 President and Chief Executive Officer,
Chambers Construction Company
(construction firm)
Franklin G. Drake President and Chief Executive Officer,
2121 S.W. Broadway, Ste. 320 Drake Management Company
Portland, Oregon 97201 (real estate investment and management)
Robert L. Dryden Executive Vice President,
Post Office Box 3707 Boeing Commercial Airplane Group,
M/S 75-11 The Boeing Company
Seattle, Washington 98124-2207 (airplane manufacturer)
John B. Fery Retired Chairman and Chief Executive
2700 Airport Way Officer, Boise Cascade Corporation
Post Office Box 15407 (forest products)
Boise, Idaho 83715
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Joshua Green III Chairman of the Board and
1425 Fourth Avenue, Suite 420 Chief Executive Officer,
Seattle, Washington 98101 Joshua Green Corporation
(family investments)
Daniel R. Nelson Retired President and Chief Operating
Officer,
U. S. Bancorp
Allen T. Noble President
575 West Bannock Farm Development Corporation
Boise, Idaho 83702 (corporation agricultural management
company)
Paul A. Redmond Chairman of the Board and
East 1411 Mission Avenue Chief Executive Officer,
Spokane, Washington 99202 The Washington Water Power Company
(electric and gas utility)
N. Stewart Rogers Chairman of the Board,
Four Lindley Road Penwest, Ltd.
Mercer Island, Washington 98040 (investments)
Benjamin R. Whiteley Chairman of the Board,
Post Office Box 711 Standard Insurance Company
Portland, Oregon 97207 (life insurance)
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EXECUTIVE OFFICERS
Name and Business Address Present Principal Occupation or Employment
Dwight V. Board Executive Vice President and Secretary,
U. S. Bancorp
Gerry B. Cameron Chairman of the Board, Chief Executive
Officer and President, U. S. Bancorp
Phyllis J. Campbell President and Chief Executive Officer,
1420 Fifth Avenue U. S. Bank of Washington, National
Seattle, Washington 98101 Association; Executive Vice President,
U. S. Bancorp
Thomas P. Ducharme Executive Vice President and Treasurer,
U. S. Bancorp
Gary T. Duim Executive Vice President, U. S. Bancorp
Steven P. Erwin Executive Vice President and
Chief Financial Officer, U. S. Bancorp
John D. Eskildsen President and Chief Executive Officer,
United States National Bank of Oregon;
Executive Vice President, U. S. Bancorp
Arland D. Hatfield Executive Vice President, U. S. Bancorp
Robert J. Lane Executive Vice President, U. S. Bancorp
Judith L. Rice Executive Vice President, U. S. Bancorp
555 S.W. Oak Street
Portland, Oregon 97204
V. Lamoine Saunders Executive Vice President, U. S. Bancorp
17650 N.E. Sandy Boulevard
Gresham, Oregon 97230
Robert D. Sznewajs Vice Chairman, U. S. Bancorp
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Exhibit Number Description
2.1 Agreement and Plan of Merger, dated as of
March 19, 1997, by and between U. S. Bancorp
and First Bank System, Inc. (incorporated by
reference to Exhibit 2.1 of the USBC 8-K).
99.1 Stock Option Agreement, dated as of March 20,
1997, by and between First Bank System, Inc.,
as issuer, and U. S. Bancorp., as grantee
(incorporated by reference to Exhibit 99.2 of
the USBC 8-K).
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