<PAGE>
AMENDED PROSPECTUS
FILED PURSUANT TO RULE 424(b)3
File No. 033-63911
NORWEST CORPORATION
428,000 SHARES OF
COMMON STOCK
(PAR VALUE $1 2/3)
This Prospectus pertains to an offering from time to time of 428,000 shares
of Common Stock (par value $1 2/3) (the "Common Stock") of Norwest Corporation
("Norwest") held by stockholders (the "Selling Stockholders") who received the
shares in exchange for shares of Valley-Hi Investment Company, a corporation
formed under the laws of the State of Texas ("Valley-Hi") and Valley-Hi National
Bank, a national banking association (the "Bank") located in San Antonio, Texas,
in connection with the acquisition of Valley-Hi and the Bank on August 1, 1995
(the "Acquisition"). See "SELLING STOCKHOLDERS." Norwest will not receive any
proceeds from the sale of the shares of Common Stock covered by this Prospectus.
Norwest has agreed to pay certain registration expenses in connection with this
offering (excluding brokerage commissions) estimated at approximately $20,000.
The distribution and sale of the shares offered hereby is subject to the
provisions of an Investment Agreement dated as of July 31, 1995 among Norwest
and the Selling Stockholders (collectively, the "Investment Agreement"). The
Investment Agreement requires, among other things, that any distribution of the
shares (defined as a "Transfer" in the Investment Agreement) to the public be
made in an "ordinary trading transaction." An "ordinary trading transaction" is
defined in the Investment Agreement as a sale of the shares on a nationally-
recognized securities exchange using the services of a broker-dealer registered
in the state where the Transfer is to occur, and without the use of special
selling efforts or methods. The Investment Agreement further prohibits any
distribution of the shares by means of an option or other derivative securities
transaction, whether or not effected on an option or other securities exchange.
The Investment Agreement also sets forth transfer requirements with respect to
the transfer of the shares of Common Stock offered hereby, including a
requirement that a Selling Stockholder provide Norwest with prior notice of any
proposed transfer of the shares and in certain cases, an opinion of counsel.
Subject to the terms of the Investment Agreement, the distribution of the shares
by the Selling Stockholders may be effected from time to time, in one or more
transactions on the New York Stock Exchange or otherwise, in special offerings,
exchange distributions or secondary distributions pursuant to and in accordance
with the rules of the New York Stock Exchange, in the over-the-counter market,
in negotiated transactions, or a combination of such methods of sale, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. Selling Stockholders may effect such
transactions by selling shares to or through broker-dealers, and such broker-
dealers may receive compensation in the form of underwriting discounts,
concessions or commissions from Selling Stockholders and/or purchasers of shares
for whom they may act as agent (which compensation may be in excess of customary
commissions). See "SELLING STOCKHOLDERS--Investment Agreement" and "PLAN of
DISTRIBUTION."
The Common Stock is traded on the New York Stock Exchange and on the
Chicago Stock Exchange under the symbol NOB. On January 29, 1997, the closing
price for the Common Stock on the New York Stock Exchange was $46.375.
PROSPECTUS DATED DECEMBER 27, 1995, AS AMENDED JANUARY 30, 1997
As a bank holding company, Norwest is subject to regulation under various
federal banking laws. See "CERTAIN REGULATORY MATTERS."
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION NOT
CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION SHOULD NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY NORWEST.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN
OFFER TO PURCHASE, NORWEST'S COMMON STOCK OFFERED BY THIS PROSPECTUS IN ANY
JURISDICTION TO OR FROM ANY PERSON TO WHOM OR FROM WHOM IT IS UNLAWFUL TO MAKE
SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
DISTRIBUTION OF SECURITIES MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE
ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF NORWEST SINCE
THE DATE OF THIS PROSPECTUS.
THE SHARES OF NORWEST'S COMMON STOCK OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS,
DEPOSITS OR OTHER OBLIGATIONS OF ANY BANK OR NONBANK SUBSIDIARY OF NORWEST AND
ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE BANK INSURANCE
FUND OR ANY OTHER GOVERNMENTAL AGENCY.
_________________________
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.
________________________
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Available Information............... 2 Selling Stockholders....... 9
Incorporation of Certain Documents Plan of Distribution....... 13
by Reference..................... 2 Description of Common Stock 13
Norwest Corporation................. 3 Legal Opinion.............. 16
Certain Regulatory Matters.......... 3 Experts.................... 16
</TABLE>
AVAILABLE INFORMATION
Norwest is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Reports, proxy
statements and other information concerning Norwest can be inspected and copied
at the Commission's public reference room located at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the public reference facilities in
the Commission's regional offices located at Seven World Trade Center, Suite
1300, New York, New York 10048, and 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. You may also access these materials through the
Commission's Web-Site on the Internet located at http:1/ www. sec. gov. copies
of such material can be obtained at prescribed rates by writing to the
Commission, Public Reference Section, 450 Fifth Street, N.W., Washington, D.C.
20549. Reports, proxy statements and other information filed by Norwest with the
New York Stock Exchange and the Chicago Stock Exchange may be inspected at the
offices of the New York Stock Exchange, 20 Broad Street, New York, New York
10005, and at the offices of the Chicago Stock Exchange, One Financial Place,
440 South LaSalle Street, Chicago, Illinois 60605.
This Prospectus does not contain all of the information set forth in the
Registration Statement on Form S-3 and exhibits thereto (the "Registration
Statement") covering the securities offered hereby which Norwest has filed with
the Commission. Certain portions of the Registration Statement have been
omitted pursuant to the rules and regulations of the Commission. Reference is
hereby made to such omitted portions for further information with respect to
Norwest and the securities offered hereby.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. DOCUMENTS RELATING TO NORWEST, EXCLUDING EXHIBITS
UNLESS SPECIFICALLY INCORPORATED THEREIN, ARE AVAILABLE WITHOUT CHARGE UPON
WRITTEN OR ORAL REQUEST TO LAUREL A. HOLSCHUH, SECRETARY, NORWEST CORPORATION,
NORWEST CENTER, SIXTH AND MARQUETTE, MINNEAPOLIS, MINNESOTA 55479-1026,
TELEPHONE (612) 667-8655.
The following documents filed with the Commission by Norwest (File No. 1-
2979) are incorporated by reference in, and made a part of, this Prospectus: (i)
Annual Report on Form 10-K for the year ended December 31, 1995; (ii) Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1996, June 30, 1996, and
September 30, 1996; and (iii) Current Reports on Form 8-K dated January 17,
1996, February 20, 1996, as amended pursuant to Form 8-K/A dated February 26,
1996, April 17, 1996, July 2, 1996, July 15, 1996, October 14, 1996 and
January 16, 1996.
2
<PAGE>
All documents filed by Norwest pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date hereof and prior to the
termination of the offering of the shares offered hereby shall be deemed to be
incorporated herein by reference and to be a part hereof from the date of such
filing. Any statement contained in a document incorporated or deemed to be
incorporated herein by reference shall be deemed to be modified or superseded
for purposes hereof to the extent that a statement contained herein or in any
other subsequently filed document which also is, or is deemed to be,
incorporated herein by reference modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part hereof.
NORWEST CORPORATION
Norwest Corporation ("Norwest") is a diversified financial services company
which was organized under the laws of Delaware in 1929 and is registered under
the Bank Holding Company Act of 1956, as amended (the "BHCA"). Norwest owns
subsidiaries engaged in banking and in a variety of related businesses. Norwest
provides retail, commercial, and corporate banking services to its customers
through banks located in Arizona, Illinois, Indiana, Iowa, Minnesota, Montana,
Nebraska, Nevada, New Mexico, North Dakota, Ohio, South Dakota, Texas,
Wisconsin, and Wyoming. Norwest provides additional financial services to its
customers through subsidiaries engaged in various businesses, principally
mortgage banking, consumer finance, equipment leasing, agricultural finance,
commercial finance, securities brokerage and investment banking, insurance,
computer and data processing services, trust services, and venture capital
investments.
At December 31, 1996, Norwest had consolidated total assets of $80.2
billion, total deposits of $50.1 billion, and total stockholders' equity of
$6.1 billion. Based on total assets at December 31, 1996, Norwest was the 12th
largest commercial banking organization in the United States.
Norwest regularly explores opportunities for possible acquisitions of
financial institutions and related businesses. In connection with many of its
completed acquisitions, Norwest has issued its Common Stock to the shareholders
of the acquired entities and can be expected to continue to do so in the future.
Generally, Norwest does not expect to make any public announcement about any
acquisition opportunity until a definitive agreement has been signed.
Norwest's principal executive offices are located at Norwest Center, Sixth
and Marquette, Minneapolis, Minnesota 55479, and its telephone number is (612)
667-1234. As used in this Prospectus, the term "Norwest" means Norwest and its
subsidiaries.
Additional information concerning Norwest is included in Norwest's
documents incorporated herein by reference. See "INCORPORATION OF CERTAIN
DOCUMENTS BY REFERENCE."
CERTAIN REGULATORY MATTERS
GENERAL
Norwest, as a bank holding company, is subject to supervision and
examination by the Federal Reserve Board. Norwest's national banking
subsidiaries are regulated primarily by the Office of the Comptroller of the
Currency ("OCC"). Its state-chartered banking subsidiaries are regulated
primarily by the Federal Deposit Insurance Corporation ("FDIC") and applicable
state
3
<PAGE>
banking agencies. Its savings and loan association subsidiary is regulated
primarily by the Office of Thrift Supervision ("OTS"). Norwest's federally
insured banking subsidiaries and savings and loan subsidiary are also subject to
regulation by the FDIC. The deposits of Norwest's banking subsidiaries are
primarily insured by the Bank Insurance Fund ("BIF") of the FDIC except for
deposits attributable to certain savings associations previously acquired by
Norwest, which are insured by the Savings Association Insurance Fund ("SAIF").
In addition to the impact of regulation, commercial banks are affected
significantly by the actions of the Federal Reserve Board as it attempts to
control the money supply and credit availability in order to influence the
economy.
DIVIDEND RESTRICTIONS
Various federal and state statutes and regulations limit the amount of
dividends the subsidiary banks can pay to Norwest without regulatory approval.
The approval of the OCC is required for any dividend by a national bank if the
total of all dividends declared by the bank in any calendar year would exceed
the total of its net income, as defined by regulation, for that year combined
with its retained net income for the preceding two years less any required
transfers to surplus or a fund for the retirement of any preferred stock. The
OTS imposes substantially similar restrictions on the payment of dividends to
Norwest by its savings and loan association subsidiary. Norwest's state-
chartered subsidiaries also are subject to dividend restrictions under
applicable state law. Under these provisions, Norwest's national bank
subsidiaries, savings and loan association, and state-chartered bank
subsidiaries could have declared, as of December 31, 1996, aggregate dividends
of at least $279.7 million without obtaining prior regulatory approval and
without reducing the capital of the banks below minimum regulatory levels.
If, in the opinion of the applicable regulatory authority, a bank under its
jurisdiction is engaged in or is about to engage in an unsafe or unsound
practice (which, depending on the financial condition of the bank, could include
the payment of dividends), such authority may require, after notice and hearing,
that such bank cease and desist from such practice. The Federal Reserve Board,
the OCC, the OTS, and the FDIC have issued policy statements which provide that
FDIC-insured banks and bank holding companies should generally pay dividends
only out of current operating earnings.
HOLDING COMPANY STRUCTURE
Norwest is a legal entity separate and distinct from its banking and
nonbanking subsidiaries. Accordingly, the right of Norwest, and thus the rights
of Norwest's creditors, to participate in any distribution of the assets or
earnings of any subsidiary is necessarily subject to the prior claims of
creditors of such subsidiary, except to the extent that claims of Norwest in its
capacity as a creditor may be recognized. The principal sources of Norwest's
revenues are dividends and fees from its subsidiaries.
Norwest's banking subsidiaries are subject to restrictions under federal
law which limit the transfer of funds by the subsidiary banks to Norwest and its
nonbank subsidiaries, whether in the form of loans, extensions of credit,
investments, or asset purchases. Such transfers by any
4
<PAGE>
subsidiary bank to Norwest or any nonbank subsidiary are limited in amount to
10% of the bank's capital and surplus and, with respect to Norwest and all such
nonbank subsidiaries, to an aggregate of 20% of such bank's capital and surplus.
Furthermore, such loans and extensions of credit are required to be secured in
specified amounts.
The Federal Reserve Board has a policy to the effect that a bank holding
company is expected to act as a source of financial and managerial strength to
each of its subsidiary banks and to commit resources to support each such
subsidiary bank. This support may be required at times when Norwest may not
have the resources to provide it. Any capital loans by Norwest to any of the
subsidiary banks are subordinate in right of payment to deposits and to certain
other indebtedness of such subsidiary bank. In addition, the Crime Control Act
of 1990 provides that in the event of a bank holding company's bankruptcy, any
commitment by the bank holding company to a federal bank regulatory agency to
maintain the capital of a subsidiary bank will be assumed by the bankruptcy
trustee and entitled to a priority of payment.
A depository institution insured by the FDIC can be held liable for any
loss incurred by, or reasonably expected to be incurred by, the FDIC, in
connection with (i) the default of a commonly controlled FDIC-insured depository
institution or (ii) any assistance provided by the FDIC to a commonly controlled
FDIC-insured depository institution in danger of default. "Default" is defined
generally as the appointment of a conservator or receiver and "in danger of
default" is defined generally as the existence of certain conditions indicating
that a "default" is likely to occur in the absence of regulatory assistance.
Federal law (12 U.S.C. (S)55) permits the OCC to order the pro rata
assessment of stockholders of a national bank whose capital stock has become
impaired, by losses or otherwise, to relieve a deficiency in such national
bank's capital stock. This statute also provides for the enforcement of any
such pro rata assessment of stockholders of such national bank to cover such
impairment of capital stock by sale, to the extent necessary, of the capital
stock of any assessed stockholder failing to pay the assessment. Similarly, the
laws of certain states provide for such assessment and sale with respect to
banks chartered by such states. Norwest, as the sole stockholder of most of its
subsidiary banks, is subject to such provisions.
REGULATORY CAPITAL REQUIREMENTS AND RELATED MATTERS
The Federal Reserve Board, the OCC, and the FDIC have adopted substantially
similar risk-based and leverage capital guidelines for banking organizations.
The guidelines are intended to ensure that banking organizations have adequate
capital given the risk levels of their assets and off-balance sheet commitments.
The risk-based capital ratio is determined by classifying assets and
certain off-balance sheet financial instruments into weighted categories, with
higher levels of capital being required for those categories perceived as
representing greater risk. Under the capital guidelines, a banking
organization's total capital is divided into two tiers. "Tier 1 capital," which
must constitute at least half of the total capital, consists of common stock,
minority interests, and noncumulative perpetual preferred stock. "Tier 2
capital" consists of hybrid capital instruments, perpetual debt, mandatory
convertible debt securities, a limited amount of subordinated debt, preferred
stock that does not qualify as Tier 1 capital, and a limited amount of the
allowance for credit losses. Under the Federal Reserve Board's risk-based
capital guidelines for bank holding companies, the
5
<PAGE>
minimum ratio of total capital to risk-adjusted assets (including certain off-
balance sheet items, such as stand-by letters of credit) is 8%. The minimum
ratio of Tier 1 capital to risk-adjusted assets is 4%. At December 31, 1996,
Norwest's Tier 1 and total capital (the sum of Tier 1 and Tier 2 capital) to
risk-adjusted assets ratios were 8.63% and 10.42%, respectively.
The Federal Reserve Board also requires bank holding companies to comply
with minimum leverage ratio guidelines. The leverage ratio is the ratio of a
bank holding company's Tier 1 capital to its total consolidated quarterly
average assets. The guidelines require a minimum "leverage ratio" of 3% for
bank holding companies that meet certain specified criteria, including that they
have the highest regulatory rating. All other bank holding companies are
required to maintain a minimum leverage ratio of 4% to 5%. The guidelines also
provide that banking organizations experiencing internal growth or making
acquisitions are expected to maintain strong capital positions substantially
above the minimum supervisory levels, without significant reliance on intangible
assets. Furthermore, the guidelines indicate that the Federal Reserve Board
will continue to consider a "tangible Tier 1 leverage ratio" in evaluating
proposals for expansion or new activities. The tangible Tier 1 leverage ratio
is the ratio of a banking organization's Tier 1 capital, less all intangibles,
to total assets, less all intangibles. As of December 31, 1996, Norwest's
leverage ratio was 6.15%. Neither Norwest nor any subsidiary bank has been
advised by the appropriate federal regulatory agency of any specific leverage
ratio applicable to it.
Each of Norwest's banking subsidiaries is also subject to capital
requirements adopted by applicable regulatory agencies which are substantially
similar to the foregoing.
Each of the federal banking agencies has revised the risk-based capital
guidelines described above to consider a banking organization's concentration
of credit risk and risk of nontraditional activities in assessing the
organization's capital adequacy, as well as its ability to manage those risks.
In addition, effective January 1, 1998, federal bank regulatory agencies will
require banking organizations that engage in significant trading activity to
calculate a charge for market risk. Organizations may opt to comply effective
January 1, 1997. Significant trading activity, for this purpose, means trading
activity of at least 10% of total assets or $1 billion, calculated on a
consolidated basis for bank holding companies. Federal bank regulators may
apply the market risk measure to other banks and bank holding companies if the
agency deems necessary or appropriate for safe and sound banking practices.
Each agency may exclude organizations that it supervises that otherwise meet the
criteria under certain circumstances. The market risk charge will be included
in the calculation of an organization's risk-based capital ratios. Norwest did
not engage in significant trading activity during the year ended December 31,
1996.
FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF 1991
The Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA") was enacted in December 1991, and substantially revised the bank
regulatory and funding provisions of the Federal Deposit Insurance Act and made
revisions to several other federal banking statutes. Among other things, FDICIA
requires the federal banking regulators to take "prompt corrective action" in
respect of FDIC-insured depository institutions that do not meet minimum capital
requirements. FDICIA establishes five capital tiers: "well capitalized,"
"adequately capitalized," "undercapitalized," "significantly undercapitalized,"
and "critically undercapitalized." Under applicable regulations, an FDIC-
insured depository institution is defined to be well capitalized if it maintains
a leverage ratio of at least 5%, a risk-adjusted Tier 1 capital ratio of at
least 6%, and a risk-adjusted total capital ratio of at least 10%, and is not
subject to a directive, order, or written
6
<PAGE>
agreement to meet and maintain specific capital levels. An insured depository
institution is defined to be adequately capitalized if its meets all of its
minimum capital requirements as described above. An insured depository
institution will be considered undercapitalized if it fails to meet any minimum
required measure, significantly undercapitalized if it has a risk-adjusted total
capital ratio of less than 6%, risk-adjusted Tier 1 capital ratio of less than
3%, or a leverage ratio of less than 3%, and critically undercapitalized if it
fails to maintain a level of tangible equity equal to at least 2% of total
assets. An insured depository institution may be deemed to be in a
capitalization category that is lower than is indicated by its actual capital
position if it receives an unsatisfactory examination rating. As of December 31,
1996, all of Norwest's insured depository institutions met the criteria for well
capitalized institutions as set forth above.
FDICIA generally prohibits a depository institution from making any capital
distribution (including payment of a dividend) or paying any management fee to
its holding company if the depository institution would thereafter be
undercapitalized. Undercapitalized depository institutions are subject to a
wide range of limitations on operations and activities, including growth
limitations, and are required to submit a capital restoration plan. The federal
banking agencies may not accept a capital plan without determining, among other
things, that the plan is based on realistic assumptions and is likely to succeed
in restoring the depository institution's capital. In addition, for a capital
restoration plan to be acceptable, the depository institution's parent holding
company must guarantee that the institution will comply with such capital
restoration plan. The aggregate liability of the parent holding company is
limited to the lesser of (i) an amount equal to 5% of the depository
institution's total assets at the time it became undercapitalized and (ii) the
amount which is necessary (or would have been necessary) to bring the
institution into compliance with all capital standards applicable with respect
to such institution as of the time it fails to comply with the plan. If a
depository institution fails to submit an acceptable plan, it is treated as if
it were significantly undercapitalized.
Significantly undercapitalized depository institutions may be subject to a
number of requirements and restrictions, including orders to sell sufficient
voting stock to become adequately capitalized, requirements to reduce total
assets, and cessation of receipt of deposits from correspondent banks.
Critically undercapitalized institutions are subject to the appointment of a
receiver or conservator.
FDICIA, as further amended by the Reigle Community Development and
Regulatory Improvement Act of 1994 also directs that each federal banking agency
prescribe standards, by regulation or guideline, for depository institutions
relating to internal controls, information systems, internal audit systems, loan
documentation, credit underwriting, interest rate exposure, asset growth,
compensation, asset quality, earnings, stock valuation, and such other
operational and managerial standards as the agency deems appropriate. The FDIC,
in consultation with the other federal banking agencies, has adopted a final
rule and guidelines with respect to internal and external audit procedures and
internal controls in order to implement those provisions of FDICIA intended to
facilitate the early identification of problems in financial management of
depository institutions. The federal banking agencies have also published the
final rules implementing three of the safety and soundness standards required by
FDICIA, including operational and managerial standards, asset quality and
earnings standards, and compensation standards. The impact of such standards on
Norwest has not yet been fully determined, but management does not believe it
will be material.
7
<PAGE>
FDICIA also contains a variety of other provisions that may affect the
operations of Norwest, including new reporting requirements, revised regulatory
standards for real estate lending, "truth in savings" provisions, and the
requirement that a depository institution give 90 days' notice to customers and
regulatory authorities before closing any branch.
Under other regulations promulgated under FDICIA a bank cannot accept
brokered deposits (that is, deposits obtained through a person engaged in the
business of placing deposits with insured depository institutions or with
interest rates significantly higher than prevailing market rates) unless (i) it
is well capitalized or (ii) it is adequately capitalized and receives a waiver
from the FDIC. A bank that cannot receive brokered deposits also cannot offer
"pass-through" insurance on certain employee benefit accounts, unless it
provides certain notices to affected depositors. In addition, a bank that is
adequately capitalized and that has not received a waiver from the FDIC may not
pay an interest rate on any deposits in excess of 75 basis points over certain
prevailing market rates. There are no such restrictions on a bank that is well
capitalized.
FDIC INSURANCE
Each BIF member institution pays FDIC insurance premiums based on the
institution's annual assessment rate assigned to it by the FDIC. The assessment
rate is based on the institution's capitalization risk category and "supervisory
subgroup." An institution's capitalization risk category is based on the FDIC's
determination of whether the institution is well capitalized, adequately
capitalized or less than adequately capitalized. An institution's supervisory
subgroup is based on the FDIC's assessment of the financial condition of the
institution and the probability that FDIC intervention or other corrective
action will be required. Subgroup A institutions are financially sound
institutions with few minor weaknesses; Subgroup B institutions are institutions
that demonstrate weaknesses which, if not corrected, could result in significant
deterioration; and Subgroup C institutions are institutions for which there is a
substantial probability that the FDIC will suffer a loss in connection with the
institution unless effective action is taken to correct the areas of weakness.
The BIF assessment rate currently ranges from 0 to 27 cents per $100 of
domestic deposits, with well capitalized Subgroup A institutions assessed at a
rate of zero and undercapitalized Subgroup C institutions assessed at a rate of
27 cents. The FDIC may increase or decrease the assessment rate schedule on a
semiannual basis. An increase in the rate assessed on one or more of Norwest's
banking subsidiaries could have a material adverse effect on Norwest's earnings
depending on the amount of the increase.
Deposits insured by SAIF held by Norwest bank subsidiaries as a result of
previous savings association acquisitions by Norwest are currently assessed at
the BIF rate of 0 to 27 cents per $100 of domestic deposits. The SAIF
assessment rate may increase or decrease as is necessary to maintain the
designated SAIF reserve ratio of 1.25% of insured deposits.
Effective January 1, 1997, FDIC-insured depositary institutions are
required to pay an assessment to provide funds for the payment of interest on
bonds issued by the Financing Corporation, a federal corporation chartered under
the authority of the Federal Housing Finance Board. The bonds (commonly referred
to as FICO bonds) were issue to capitalize the Federal Savings and Loan
Insurance Corporation. Until December 31, 1999, or when the last savings and
loan association ceases to exist, whichever occurs first, institutions will pay
approximately 6.4 cents per $100 of SAIF assessable deposits and approximately
1.3 cents per $100 of BIF assessable deposits.
Subject to certain exceptions, BIF and SAIF will be merged into one
insurance fund effective January 1, 1999.
8
<PAGE>
SELLING STOCKHOLDERS
GENERAL
The following table sets forth certain information with respect to the
beneficial ownership of Norwest's Common Stock as of January 27, 1997 by each of
the Selling Stockholders who may offer shares for sale by this Prospectus
(referred to herein individually as a "Selling Stockholder" and collectively as
the "Selling Stockholders").
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING AND
NAME (1) TO BE OFFERED HEREBY (2)(3)
-------- ---------------------------
Ray Ellison Trust Number One 364,255 (4)
San Antonio Area Foundation (5) 25,989 (5)
John H. (Jack) Willome (5) 1,422 (5)
Jack E. Biegler 975
Jack Robinson 975
All Selling Stockholders as a group
(5 persons) 393,616
- -----------------------------------
(1) Except as may be otherwise indicated in the footnotes to the above table,
the Selling Stockholders have sole voting and investment power with respect
to the shares of Norwest Common Stock shown above opposite their respective
names.
(2) Ray Ellison Trust Number One (the "Trust") and Messrs. Willome, Biegler and
Robinson held all of the outstanding stock of Valley-Hi and the Bank prior
to the Acquisition and were issued an aggregate of 428,000 shares of
Norwest Common Stock in the Acquisition (without adjustment to reflect cash
received in lieu of fractional shares). The shares issued in the Acquisition
were subsequently registered for resale pursuant to the Registration
Statement in which this Prospectus is included, effective December 27, 1995
(the "Effective Date"). Since August 1, 1995, and subsequent to the
Effective Date, Messrs. Biegler and Robinson each sold 17,191 of the 18,168
shares they received in the Acquisition. In addition, Mr. Willome made a
charitable gift of 25,989 of the 27,411 shares he received in the
Acquisition. See footnote 5 below.
(3) The shares of Norwest Common Stock issued in the Acquisition to the Selling
Stockholders named above include 23,000 shares (the "Escrowed Shares") to be
deposited in escrow pursuant to an Escrow Agreement dated as of July 31,
1995 to provide for the indemnification of Norwest and its affiliates,
including Valley-Hi and the Bank, against certain potential federal tax
liabilities that may arise subsequent to Norwest's acquisition of Valley-Hi
and the Bank pursuant to a related Tax Indemnification Agreement also dated
July 31, 1995 to which the Selling Stockholders are also parties. See
"Certain Relationships and Transactions--Tax Indemnification Agreement"
below. The number of shares of Norwest Common Stock owned by each of the
Selling Stockholders held in escrow pursuant to the Escrow Agreement are as
follows: Ray Ellison Trust Number One -- 19,578 shares; John H. (Jack)
Willome -- 1,472 shares; Jack E. Biegler -- 975 shares; and Jack Robinson --
975 shares. The Selling Stockholders hold sole voting power and have the
right to receive all cash dividends with respect to the Escrowed Shares
registered in their respective names. Until distribution of the Escrowed
Shares occurs pursuant to the Escrow Agreement, the Selling Stockholders
cannot dispose of the Escrowed Shares.
(4) Ray Ellison Trust Number One ("Ellison Trust No. 1"), is a revocable, inter
vivos trust, the grantor and sole beneficiary of which is Ray Ellison. The
trustees of the Ellison Trust No. 1 are three individuals, one of whom is
Bonnie Ellison, the adult daughter of Mr. Ellison. The trustees share
voting power with respect to the shares of Norwest Common Stock held by the
Ellison Trust No. 1. By virtue of his power to revoke the trust, Mr.
Ellison may be considered to share investment power with respect to the
shares of Norwest Common Stock held by the Ellison Trust No. 1 and offered
9
<PAGE>
hereby, and may thus be deemed to share beneficial ownership of such shares
with the trust and to be considered a Selling Stockholder hereunder with the
Ellison Trust No. 1.
As described more fully below under the heading, "Investment Agreement--
Distribution and Transfer Restrictions," the Ellison Trust No. 1 may assign
its rights to transfer its shares of Norwest Common Stock offered hereby
without restriction to Mr. Ellison as its sole beneficiary, or to "Ray
Ellison Trust Number 2," a related trust ("Ellison Trust No. 2")
(collectively, the "Ellison Trusts") and its beneficiaries. As currently
structured, in the event of Mr. Ellison's death, the shares of Norwest
Common Stock shown above as held by Ellison Trust No. 1 would be transferred
by will to Ellison Trust No. 2, the primary beneficiaries of which are
Bonnie Ellison and Ray Ellison, Jr., Mr. Ellison's adult son. As a result,
such transferees effectively would be substituted for Ellison Trust No. 1 as
Selling Stockholders, and be permitted to sell any shares so transferred
pursuant this Prospectus and the more favorable transfer restrictions under
the Investment Agreement applicable only to the shares held by Ellison
Trusts.
(5) By an Assignment Agreement dated as of December 17, 1996, and with the
consent of Norwest, John H. (Jack) Willome transferred and assigned all of
his right, title, and interest in the Investment Agreement and in the
indicated shares to the San Antonio Area Foundation, a Texas non-profit
corporation (the "Foundation"), as a charitable contribution. Under the
terms of the Assignment Agreement, the Foundation agreed to be bound by all
the terms and conditions of the Investment Agreement described below as if
it were an original signatory thereto. As the result of such assignment and
transfer, the Foundation has been added as a named Selling Stockholder
herein. John H. (Jack) Willome is a director and the treasurer of the
Foundation. Mr. Willome disclaims any beneficial ownership of the shares
transferred to the Foundation.
INVESTMENT AGREEMENT
In connection with the Acquisition of Valley-Hi and the Bank by Norwest,
the Selling Stockholders entered into the Investment Agreement with Norwest,
pursuant to which the shares offered and sold by the Selling Stockholders hereby
were issued. Under the terms of the Investment Agreement, Norwest agreed to
register the shares to be issued to the Selling Stockholders in the Acquisition
for re-sale to the public pursuant to the Securities Act of 1933 (the
"Securities Act") and the Selling Stockholders jointly and severally agreed that
they would not directly or indirectly offer, sell, pledge or transfer or
otherwise dispose of (or solicit any offers to buy, purchase, or otherwise
acquire or pledge) any of such shares, except in compliance with the Investment
Agreement, the Securities Act, and the rules and regulations promulgated
thereunder. As described more fully under the headings "Distribution and
Transfer Requirements" and "Assignment" below, the Investment Agreement contains
provisions relating to, among other matters, the manner in which shares may be
distributed, procedures which must be followed by a Selling Stockholder in
connection with any proposed sale or other transfer of the shares of Norwest
Common Stock acquired pursuant to the Investment Agreement and any assignment of
such rights under the Investment Agreement.
Distribution and Transfer Requirements. The Investment Agreement provides
that any distribution of the shares (defined as a "Transfer" in the Investment
Agreement) to the public be made in an "ordinary trading transaction." An
"ordinary trading transaction" is defined in the Investment Agreement as a sale
of the shares on a nationally-recognized securities exchange using the services
of a broker-dealer registered in the state where the transfer is to occur, and
without the use of special selling efforts or methods. The Investment Agreement
further prohibits a distribution of the shares either to the public or in a
transaction exempt from registration under the
10
<PAGE>
Securities Act or applicable state securities law by means of an option or other
derivative securities transaction, whether or not effected on an option or other
securities exchange.
The Investment Agreement also contains a number of transfer requirements
with respect to the shares applicable for a period of two years after the
issuance of the shares. Norwest has the right to refuse to transfer any shares
sold by a Selling Stockholder pursuant to the Investment Agreement and this
prospectus if such Selling Stockholder does not comply with the transfer
procedures set forth in the Investment Agreement. Under these requirements,
each Selling Stockholder must provide five business days written notice
(referred to in the Investment Agreement as the "Notice Period") to Norwest of
any proposed sale or other transfer of the shares offered by the Selling
Stockholders pursuant to this Prospectus. Following receipt of this notice,
Norwest must notify the Selling Stockholder proposing to make the transfer of
shares by 5:00 p.m., Minneapolis, Minnesota time on the last day of the Notice
Period, either that the transfer may occur or that it must be deferred. Any
such transfer will be deferred either in order to permit updating of this
Prospectus or because Norwest has provided the Selling Stockholder a certificate
stating that it would be detrimental to Norwest and its stockholders for the
Selling Stockholder to immediately proceed with the proposed transfer. If
Norwest provides such certificate, Norwest may defer any proposed transfer for
one or more successive 30 day periods. If Norwest does not defer the proposed
sale or other transfer, then the Selling Stockholder must complete the proposed
sale or transfer by the fifth business day after the end of the Notice Period.
In addition, the Investment Agreement specifies certain minimums for the
Selling Stockholders as to the frequency of Transfers and the number of shares
that may be included in any single transfer. Generally, each Selling
Stockholder (other than the Ellison Trust No. 1, Ellison Trust No. 2, any
successor trusts, certain assignees and/or beneficiaries of such trusts, as
described in footnote (3) to the Selling Stockholders' table), may sell or
otherwise transfer not less than 2,000 of the shares of Norwest Common Stock
held by him per Transfer, with not more than one Transfer to occur every three
months in any twelve-month period, beginning on December 12, 1995, (the date the
registration statement registering the shares offered hereby became effective)
and ending on the earlier of either the date all such shares are sold pursuant
to this Prospectus or the date such shares may be sold in a public distribution
pursuant to Rule 144 of the Securities Act. This period during which Transfers
must comply with the terms of the Investment Agreement is referred to as the
"Effective Period." During the Effective Period, the Ellison Trusts and any
permitted assignee of the Trusts, as a group, and the beneficiaries of Ellison
Trust No. 2 individually (if and when any shares that may in the future be held
by Ellison Trust Number 2 are distributed to them) may sell or otherwise
transfer shares held by them in an amount per Transfer not less than 10,000
shares, with not more than one such Transfer to occur every 45 days. See
footnote (3) to the Selling Stockholder table for information about Ellison
Trusts, and the Ellison Trust No. 2 beneficiaries.
Notwithstanding the limitations on Transfers described in this Prospectus,
a Selling Stockholder has the right to transfer his shares during a period
commencing on the fifth business day after each date on which Norwest files its
annual report on Form 10-K, its quarterly reports on Form 10-Q, or at Norwest's
option, current reports on Form 8-K containing certain financial information and
ending on the tenth business day following such date, provided that the Selling
Stockholder has first given Norwest the written notice described above and
Norwest has not exercised its right to defer such transfer by delivering the
officer's certificate described above. If a proposed transfer of the shares is
to be effected other than by a sale or offer to sell the shares
11
<PAGE>
pursuant to this Prospectus as for example, in a transaction not involving a
public offering, the notice from the Selling Stockholder must describe the
proposed transfer and be accompanied by an opinion of experienced securities
counsel acceptable to Norwest with respect to the transfer's compliance with
applicable federal and state securities law registration and other requirements.
In addition, the Investment Agreement requires the Selling Stockholder to
furnish certain documentation to the transfer agent of Norwest's Common Stock as
a condition to completing the transfer.
Assignment. The right of the Selling Stockholders named in this Prospectus
to transfer their shares pursuant to the Investment Agreement is generally not
assignable by operation of law or otherwise, without Norwest's consent. Such
consent is not required, however, in the case of a transfer by bequest, devise,
inheritancy, laws of intestacy, or gift, or in the event of a transfer by
Ellison Trust No. 1 to its beneficiaries (currently, the sole beneficiary of
Ellison Trust No. 1 is Mr. Ellison), or to Ellison Trust No. 2 or to any of its
beneficiaries.
CERTAIN RELATIONSHIPS AND TRANSACTIONS
Indemnification Agreement. As a condition to Norwest's consummation of the
Valley-Hi acquisition, Norwest required the Selling Stockholders to enter into
an indemnification agreement with Norwest dated as of July 31, 1995, (the
"Indemnification Agreement") with respect to certain additional taxes, including
interest, penalties and expenses (referred to as a "Tax Loss") that may be owed
in the future. Under the terms of the Indemnification Agreement, the Selling
Stockholders agreed to indemnify and hold harmless Norwest, its subsidiaries
(including Valley-Hi and its affiliates), and their respective successors,
directors, officers, employees, and agents from, and to assume liability for any
such "Tax Loss" incurred by Norwest and/or Valley-Hi for the tax year in which
the Acquisition occurred, up to the maximum value of certain "Escrowed Shares"
described below. Norwest has agreed to provide the Selling Stockholders with
notice of any tax claim by the Internal Revenue Service which could result in a
Tax Loss in a timely manner to allow the Selling Stockholders, with certain
limitations, to contest such a claim at their expense (subject to Norwest's
right to participate in such a contest).
In order to provide for a mechanism by which the Selling Stockholders'
could satisfy any such indemnification obligation, and also as a condition to
the consummation of Norwest's acquisition of Valley-Hi, the Selling Stockholders
executed an Escrow Agreement, also dated as of July 31, 1995 (the "Escrow
Agreement"). The Escrow Agreement provides for the escrow with Norwest Bank
Minnesota, N.A. as Escrow Agent of the 23,000 Escrowed Shares of Norwest Common
Stock received by the Selling Stockholders in the Acquisition until March 15,
1999, unless the Escrowed Shares are earlier distributed upon notice to the
Escrow Agent that a Tax Loss or the certain other events specified in the Escrow
Agreement have occurred. Under the terms of the Escrow Agreement, the Escrow
Agent is instructed, upon its receipt of a notice of a Tax Loss, to distribute
to Norwest that number of Escrowed Shares computed by dividing the amount of the
Tax Loss by $23.00, and then rounding that number to the nearest whole share. In
the event of a partial distribution of the Escrowed Shares to Norwest, each
Selling Stockholder will contribute to such distribution that number of Escrowed
Shares computed based its or his proportionate interest in the Escrowed Shares.
The Selling Stockholders retain the sole right to vote and receive cash
dividends on the Escrowed Shares, but have no power to dispose of all or any
part of the Escrowed Shares, until termination of the escrow and distribution to
Norwest and the
12
<PAGE>
Selling Stockholders of the Escrowed Shares pursuant to the Escrow Agreement.
See footnote (2) to the Selling Stockholders' table above for additional
information regarding the Escrowed Shares.
Former Directors and Executive Officers. At the time of the acquisition of
Valley-Hi and the Bank by Norwest in August 1995, Jack E. Biegler served as the
sole director and president of Valley-Hi. Mr. Biegler resigned his positions as
director and president effective upon the consummation of Norwest's acquisition
of Valley-Hi.
PLAN OF DISTRIBUTION
The distribution and sale of the shares is subject to the provisions of the
Investment Agreement described above under the heading "SELLING STOCKHOLDERS--
Investment Agreement." Subject to the Selling Stockholders' compliance with
the transfer and other provisions of the Investment Agreement described above,
the distribution of the shares by the Selling Stockholders may be effected from
time to time, in one or more transactions on the New York Stock Exchange or
otherwise, in special offerings, exchange distributions or secondary
distributions pursuant to and in accordance with the rules of the New York Stock
Exchange, in the over-the counter market, in negotiated transactions, or a
combination of such methods of sale, at market prices prevailing at the time of
sale, at prices related to such prevailing market prices or at negotiated
prices. Selling Stockholders may effect such transactions by selling shares to
or through broker-dealers, and such broker-dealers may receive compensation in
the form of underwriting discounts, concessions or commissions from Selling
Stockholders and/or purchasers of shares for whom they may act as agent (which
compensation may be in excess of customary commissions). Selling Stockholders
and broker-dealers that participate with Selling Stockholders in the
distribution of shares may be deemed to be "underwriters" within the meaning of
Section 2(11) of the Securities Act of 1933, and any commissions received by
them and any profit on the resale of shares may be deemed to be underwriting
compensation. See "SELLING STOCKHOLDERS--Investment Agreement."
DESCRIPTION OF COMMON STOCK
GENERAL
Norwest's Certificate of Incorporation authorizes the issuance of
500,000,000 shares of Common Stock, par value $1 2/3 per share, 5,000,000 shares
of preferred stock, without par value ("Preferred Stock"), and 4,000,000 shares
of preference stock ("Preference Stock"). At December 31, 1996, 375,533,625
shares of Common Stock were issued, of which 368,702,706 were outstanding, and
6,830,919 were held as treasury shares, and 1,038,779 shares of Preferred Stock
were outstanding, consisting of 980,000 shares of Cumulative Tracking Preferred
Stock (of which 25,000 shares are held by a subsidiary of Norwest), 11,594
shares of ESOP Cumulative Convertible Preferred Stock, and 22,716 shares of 1995
ESOP Cumulative Convertible Preferred Stock, and 24,469 shares of 1996 ESOP
Cumulative Convertible Preferred Stock. In addition, 1,250,000 shares of
Preferred Stock are reserved for issuance under the Rights Agreement dated as of
November 22, 1988, between Citibank, N.A. as Rights Agent, and Norwest (the
"Rights Agreement"). Norwest has also authorized for issuance from time to time
and registered or filed for registration with the Commission, pursuant to three
universal shelf registration statements, an
13
<PAGE>
indeterminate number of securities (the "Shelf Securities") with an aggregate
initial offering price, as of the date of this Prospectus, not to exceed $5.150
billion. The Shelf Securities may be issued as Preferred Stock or as securities
convertible into shares of Preferred Stock and Preference Stock or Common Stock.
Based on the number of shares of Preferred Stock authorized for issuance under
the Norwest Certificate as of December 31, 1996, the maximum number of shares of
Preferred Stock, Preference Stock and Common Stock, respectively, that could be
issued pursuant to the effective shelf registration statements, when added to
shares of Preferred Stock, Preference Stock and Common Stock already reserved
for issuance, issued, or outstanding, could not exceed respectively, 5,000,000
shares of Preferred Stock, 4,000,000 shares of Preference Stock, and 500,000,000
shares of Common Stock. All or any portion of the authorized but unissued
Preferred Stock or Shelf Securities issuable as Preferred Stock or convertible
into Preferred Stock or Common Stock, may be issued by Norwest's Board of
Directors without further action by stockholders. Holders of Preferred Stock
have certain rights and preferences with respect to dividends and upon
liquidation that are superior to those of holders of Common Stock. The relative
rights and preferences of any Preferred Stock issued in the future may be
established by Norwest's Board of Directors without stockholder action. Although
Norwest has no current plans for the issuance of any shares of Preferred Stock,
except as disclosed in this Prospectus, such shares, when and if issued, could
have dividend, liquidation, voting, and other rights superior to those of the
Common Stock.
COMMON STOCK
Subject to any prior rights of any Preferred Stock then outstanding,
holders of Common Stock are entitled to receive such dividends as are declared
by Norwest's Board of Directors out of funds legally available for that purpose.
For information concerning legal limitations on the ability of Norwest's banking
subsidiaries to supply funds to Norwest, see "CERTAIN REGULATORY MATTERS."
Subject to the rights, if any, of any Preferred Stock then outstanding, all
voting rights are vested in the holders of Common Stock, each share being
entitled to one vote. Subject to any prior rights of any Preferred Stock, in
the event of liquidation, dissolution, or winding up of Norwest, holders of
shares of Common Stock are entitled to receive pro rata any assets distributable
to stockholders in respect of shares held by them. Holders of shares of Common
Stock do not have any preemptive right to subscribe for any additional
securities which may be issued by Norwest. The outstanding shares of Common
Stock, including the shares offered hereby, are fully paid and nonassessable.
The transfer agent and registrar for the Common Stock is Norwest Bank Minnesota,
N.A. Each share of Common Stock also includes, and each share offered hereby
will include, a right to purchase certain Preferred Stock. See "Rights to
Purchase Preferred Stock" below.
The foregoing description of the material terms of the Common Stock does
not purport to be complete and is qualified in its entirety by reference to
Article Fourth of Norwest's Certificate of Incorporation.
RIGHTS TO PURCHASE PREFERRED STOCK
Each share of Common Stock, including the shares being offered hereby, is
accompanied by one preferred share purchase right (collectively, the "Rights").
Once exercisable, each Right entitles the registered holder to purchase one
four-hundredth of a share of Norwest's Series A Junior Participating Preferred
Stock, without par value (collectively, the "Junior Preferred
14
<PAGE>
Shares"). Until a Right is exercised, the holder of a Right, as such, will have
no rights as a stockholder of Norwest including, without limitation, the right
to vote or receive dividends.
The Rights trade automatically with shares of Common Stock and become
exercisable only under the circumstances described below. The Rights are
designed to protect the interests of Norwest and its stockholders against
coercive takeover tactics. The purpose of the Rights is to encourage potential
acquirors to negotiate with Norwest's Board of Directors prior to attempting a
takeover and to give the Board leverage in negotiating on behalf of all
stockholders the terms of any proposed takeover. The Rights may, but are not
intended to, deter takeover proposals.
Junior Preferred Shares purchasable upon exercise of the Rights will rank
junior to all other series of Preferred Stock and will not be redeemable. Each
Junior Preferred Share will, subject to the rights of senior securities of
Norwest, be entitled to a preferential cumulative quarterly dividend payment
equal to the greater of $1.00 per share or, subject to certain adjustments, 400
times the dividend declared per share of Common Stock. Upon liquidation of
Norwest, the holders of the Junior Preferred Shares will, subject to the rights
of such senior securities, be entitled to a preferential liquidation payment
equal to the greater of $400 per share plus all accrued and unpaid dividends or
400 times the payment made per share of Common Stock. Finally, in the event of
any merger, consolidation or other transaction in which shares of Common Stock
are exchanged, each Junior Preferred Share will, subject to the rights of such
senior securities, be entitled to receive 400 times the amount received per
share of Common Stock. These rights of the Junior Preferred Shares are
protected by customary antidilution provisions. Each Junior Preferred Share
will have 400 votes, voting together with the Common Stock.
The purchase price for each one one-hundredth of a Junior Preferred Share
is $175.00. The purchase price is subject to adjustment upon the occurrence of
certain events, including stock dividends on the Junior Preferred Shares or
issuance of warrants for, or securities convertible on certain terms into,
Junior Preferred Shares. The number of Rights outstanding and the number of
Junior Preferred Shares issuable upon the exercise of the Rights are subject to
adjustment in the event of a stock split of, or a stock dividend on, the Common
Stock.
The Rights will become exercisable only if a person or group acquires or
announces an offer to acquire 25% or more of the outstanding shares of the
Common Stock. This triggering percentage may be reduced to no less than 15% by
the Board of Directors prior to the time the Rights become exercisable. The
Rights have certain additional features that will be triggered upon the
occurrence of specified events:
(1) If a person or group acquires at least the triggering percentage
of the Common Stock, the Rights permit holders of the Rights, other than
such person or group, to acquire the Common Stock at 50% of market value.
However, this feature will not apply if a person or group which owns less
than the triggering percentage acquires at least 85% of the outstanding
shares of Common Stock pursuant to a cash tender offer for 100% of the
outstanding Common Stock.
(2) After a person or group acquires at least the triggering
percentage and before the acquiror owns 50% of the outstanding shares of
Common Stock, the Board of Directors may exchange each Right, other than
Rights owned by such acquiror, for one share of Common Stock or one four-
hundredth of a Junior Preferred Share.
15
<PAGE>
(3) In the event of certain business combinations involving Norwest
or the sale of 50% or more of the assets or earning power of Norwest, the
Rights permit holders of the Rights to purchase the stock of the acquiror
at 50% of market value.
At any time prior to the acquisition by a person or group of the triggering
percentage or more of the outstanding shares of Common Stock, the Board of
Directors may redeem the Rights in whole, but not in part, at a price of $.0025
per Right (the "Redemption Price"). The redemption of the Rights may be made
effective at such time, on such basis, and with such conditions as the Board of
Directors in its sole discretion may establish. Immediately upon any redemption
of the Rights, the right to exercise the Rights will terminate and the only
remaining right of the holders of Rights will be to receive the Redemption
Price.
The Rights will expire on November 23, 1998, unless extended or earlier
redeemed by Norwest. Generally, the terms of the Rights may be amended by the
Board of Directors without the consent of the holders of the Rights.
The foregoing description of the material terms of the Rights does not
purport to be complete and is qualified in its entirety by reference to the
Rights Agreement and related Certificates of Adjustment dated July 21, 1989 and
June 28, 1993.
LEGAL OPINION
A legal opinion to the effect that the shares of Norwest's Common Stock
offered hereby were validly issued and fully paid and nonassessable has been
rendered by Stanley S. Stroup, Executive Vice President and General Counsel of
Norwest. At December 31, 1996, Mr. Stroup was the owner of approximately
102,247 shares and held options to acquire 240,943 additional shares of
Norwest's Common Stock.
EXPERTS
The consolidated financial statements of Norwest and subsidiaries as of
December 31, 1994 and 1995, and for each of the years in the three-years period
ended December 31, 1995, incorporated by reference herein, have been
incorporated herein in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein and
upon the authority of said firm as experts in accounting and auditing.
16
