AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 23, 1994
REGISTRATION NO. 33-50299
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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U S WEST, INC.
(Exact name of registrant as specified in its charter)
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<TABLE>
<S> <C>
COLORADO NO. 84-0926774
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
</TABLE>
7800 EAST ORCHARD ROAD
ENGLEWOOD, COLORADO 80111
(303) 793-6500
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
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STEPHEN E. BRILZ, ESQ.
U S WEST, INC.
7800 EAST ORCHARD ROAD
ENGLEWOOD, COLORADO 80111
(303) 793-6626
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
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COPIES TO:
BARBARA M. JAPHA, ESQ.
U S WEST, INC.
7800 EAST ORCHARD ROAD
ENGLEWOOD, COLORADO 80111
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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 the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. / /
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT 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.
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<PAGE>
SUBJECT TO COMPLETION, DATED FEBRUARY 23, 1994
[US WEST LOGO]
24,000,000 SHARES
U S WEST, INC.
COMMON STOCK
(NO PAR VALUE)
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This Prospectus relates to an aggregate of up to 24,000,000 shares (the
"Shares") of Common Stock, no par value (the "Common Stock"), of U S WEST, Inc.
("U S WEST" or the "Company"), which may be issued pursuant to the exercise of
certain non-transferable rights to purchase (the "Rights to Purchase") Common
Stock.
The Rights to Purchase were issued as part of the settlement (the
"Settlement") of certain class action litigation (the "Litigation") brought
against U S WEST and certain individual defendants on behalf of a class
consisting of all persons ("Class Members") who purchased Common Stock during
the period from February 15, 1990 through March 6, 1992. See "The Offering."
The Rights to Purchase entitle the holders thereof to purchase Common Stock
directly from U S WEST on a commission-free basis at $ per share,
representing a 3% discount from the average of the high and low trading prices
of such stock on the New York Stock Exchange (the "NYSE") on February 23, 1994.
In accordance with the terms of the Settlement, the number of Shares purchased
by Class Members at this discounted price is determined with reference to
amounts previously tendered by such Class Members. As of the close of business
on February 22, 1994, the deadline (subject to limited exceptions) for
submission of such payments, U S WEST had received an aggregate of approximately
$ from Class Members for application toward the purchase of Shares
pursuant to the offering. Based on this amount of aggregate receipts and using
the purchase price of $ per Share determined in accordance with the
formula set forth above, U S WEST estimates that the maximum number of Shares
issuable pursuant to this offering is 24,000,000. However, because amounts
submitted by recipients of Rights to Purchase may exceed the exact price of a
whole number of Shares, and due to other factors, the aggregate receipts by U S
WEST and the maximum number of Shares issuable pursant to the offering are only
estimates. The exercise price and other terms of the Rights to Purchase are set
forth in the Settlement and were determined by negotiation between U S WEST and
the plaintiffs in the Litigation.
U S WEST's Common Stock is traded on the NYSE and the Pacific Stock Exchange
under the symbol "USW." On February 18, 1994, the high and low NYSE Composite
trading prices of a share of Common Stock were $40 3/4 and $39 3/4,
respectively.
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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.
------------------------
U S WEST will receive the exercise price for each Share of Common Stock
issued upon exercise of the Rights to Purchase. U S WEST will not receive any
proceeds from the subsequent sale of the Shares. See "Use of Proceeds."
<TABLE> <CAPTION>
PRICE TO PUBLIC(1) PROCEEDS TO U S WEST(2)
<S> <C> <C>
Per Share............................................. $ $
Total................................................. $ $
</TABLE>
(1) The price per Share is equal to 97% of $ , the average of the high and
low trading prices of the Common Stock on the NYSE on February 23, 1994.
(2) Before deducting estimated expenses of the offering of $630,000, payable by
U S WEST.
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THE DATE OF THIS PROSPECTUS IS FEBRUARY , 1994.
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAW OF ANY SUCH STATE.
<PAGE>
FOR NORTH CAROLINA INVESTORS
The Commissioner of Insurance of the State of North Carolina has not
approved or disapproved this offering nor has the Commissioner passed upon the
accuracy or adequacy of this Prospectus.
AVAILABLE INFORMATION
U S WEST 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"). Such reports, proxy
statements, and other information concerning U S WEST can be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the Commission's
Regional Offices at Seven World Trade Center, 13th Floor, New York, New York
10048, and Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60601. Copies of such material can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, at prescribed rates. Such reports, proxy statements and
other information concerning U S WEST may also be inspected at the offices of
the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005 and
the Pacific Stock Exchange, 301 Pine Street, San Francisco, California 94104,
the securities exchanges on which shares of U S WEST Common Stock are listed.
U S WEST has filed with the Commission a registration statement on Form S-3
(herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information, reference is hereby made to the Registration Statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents which have been filed by U S WEST with the
Commission (File No. 1-8611) are incorporated herein by reference: (i) Annual
Report on Form 10-K for the year ended December 31, 1992, (ii) Quarterly Report
on Form 10-Q for the quarter ended March 31, 1993, (iii) Quarterly Report on
Form 10-Q for the quarter ended June 30, 1993, (iv) Quarterly Report on Form
10-Q for the quarter ended September 30, 1993, (v) Current Reports on Form 8-K
dated January 11, 1993, January 21, 1993, April 19, 1993, May 24, 1993, May 28,
1993, June 1, 1993, June 28, 1993, July 22, 1993, August 5, 1993 (as amended by
Form 8-KA dated August 11, 1993), August 20, 1993 (the Current Report dated
August 20, 1993 includes audited financial statements that have been
reclassified to reflect the discontinuance by U S WEST of the operations of its
Capital Assets segment, and a Management's Discussion and Analysis of Financial
Condition and Results of Operations that has been restated for the same
purpose), September 17, 1993, October 13, 1993, October 19, 1993, November 10,
1993, December 8, 1993 (as amended by Form 8-KA dated December 13, 1993, and as
further amended by Form 8-KA dated December 28, 1993) and January 21, 1994, (vi)
the description of the Common Stock of U S WEST contained in Item 11 of U S
WEST's Registration Statement on Form 10, filed with the Commission on November
16, 1983, as amended, and (vii) the description of certain preferred stock
purchase rights as set forth in Item 1 of U S WEST's Registration Statement on
Form 8-A, filed with the Commission on April 18, 1989.
All documents filed by U S WEST pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the termination of the offering of the Shares shall be deemed to be incorporated
by reference into this Prospectus and to be a part hereof from the date of
filing of such documents.
Any statement contained 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
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
U S WEST will provide without charge to each person to whom a Prospectus is
delivered, upon written or oral request of such person, a copy of any or all of
the documents which are incorporated by reference herein, other than exhibits to
such documents which are not specifically incorporated by reference therein.
Requests should be directed to the Treasurer, U S WEST, Inc., 7800 East Orchard
Road, Englewood, Colorado 80111 (Telephone (303) 793-6500).
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<PAGE>
U S WEST, INC.
U S WEST was incorporated in 1983 under the laws of the State of Colorado
and has its principal executive offices at 7800 East Orchard Road, Englewood,
Colorado 80111 (telephone number (303) 793-6500). It is a diversified global
communications company engaged in the telecommunications, directory publishing,
marketing and, most recently, entertainment services businesses.
Telecommunications services are provided by U S WEST's principal subsidiary to
more than 25 million residential and business customers in the states of
Arizona, Colorado, Idaho, Iowa, Minnesota, Montana, Nebraska, New Mexico, North
Dakota, Oregon, South Dakota, Utah, Washington and Wyoming (collectively, the "U
S WEST Region"). Directory publishing, marketing and entertainment services as
well as cellular mobile communications services are provided by other U S WEST
subsidiaries to customers both inside and outside the U S WEST Region. See
"Business of U S WEST." U S WEST had total assets in excess of $20 billion at
December 31, 1993.
RECENT DEVELOPMENTS
1993 EARNINGS RESULTS
On January 20, 1994, U S WEST announced that its revenues grew in 1993 by
$471 million to $10.29 billion, a 4.8 percent increase over 1992. The Company
also announced that pre-tax income from continuing operations increased 11.2
percent over 1992, before the effects of one-time charges. After-tax income, on
the same basis, increased 6.0 percent to $1.14 billion, or $2.72 per share. By
comparison, 1992 income was $1.08 billion or $2.61 per share.
TWE INVESTMENT
On September 15, 1993, U S WEST acquired a 25.51% pro-rata priority capital
and residual equity interest in Time Warner Entertainment Company, L.P. ("TWE")
for an aggregate purchase price of $2.55 billion consisting of $1.53 billion in
cash and $1.02 billion in the form of a four-year promissory note bearing
interest at a rate of 4.391% per annum (the "TWE Investment"). TWE owns and
operates substantially all of the filmed entertainment (including Warner Bros.),
programming (including HBO and Cinemax) and cable operations previously owned
and operated by Time Warner, Inc. In connection with the TWE Investment, the
Company acquired 12.75 percent of the common stock of Time Warner Entertainment
Japan, Inc., a joint venture company established to expand and develop the
market for entertainment services in Japan.
U S WEST and TWE intend to upgrade a substantial portion of TWE's cable
systems to "Full Service NetworkTM" capacity over the next five years. U S WEST
and TWE will jointly designate the systems to be upgraded and share management
control over those systems. U S WEST believes that each Full Service NetworkTM,
when completed, will utilize fiber optics, digital compression, digital
switching and storage services to provide customers with a variety of services,
including video-on-demand, interactive games, distance learning, full motion
video, interactive shopping and alternative access and local telephone service.
RESTRUCTURING
On September 17, 1993, U S WEST announced that its largest operating
subsidiary, U S WEST Communications, Inc. ("U S WEST Communications"), would
implement a plan (the "Restructuring Plan") designed to provide faster, more
responsive customer services while reducing the costs of providing these
services. Pursuant to the Restructuring Plan, U S WEST Communications will
develop new systems that will enable it to monitor networks to reduce the risk
of service interruptions, activate telephone service on demand, provide
automated inventory systems and centralize its service centers so that customers
can have their telecommunications needs resolved with one phone call. U S WEST
Communications will also reduce its work force by approximately 8,000 employees
by the end of 1996 (in addition to a remaining
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<PAGE>
reduction of 1,000 employees pursuant to a restructuring plan announced in 1991)
and consolidate the operations of its existing 560 customer centers into 26
customer centers in ten cities. U S WEST expects cost reductions will be
realized as these components of the Restructuring Plan are implemented. In the
third quarter of 1993, U S WEST accrued a one time, after tax charge of $610
million for costs associated with the Restructuring Plan, including employee
severance benefits, employee relocation costs and building preparation and
system installation costs. See "Business of U S WEST--Competitive Strategy" and
"Business of U S WEST--Base Businesses."
DISCONTINUANCE OF SFAS 71 ACCOUNTING
In the third quarter of 1993, U S. WEST incurred a $3.1 billion non-cash,
extraordinary charge, net of an income tax benefit of $2.3 billion, against its
earnings in conjunction with its decision to discontinue accounting for the
operations of U S WEST Communications in accordance with Statement of Financial
Accounting Standards No. 71, "Accounting for the Effects of Certain Types of
Regulations" ("SFAS 71"). SFAS 71 generally applies to regulated companies that
meet certain requirements, including a requirement that a company be able to
recover its costs, notwithstanding competition, by charging its customers at
prices established by a regulator. U S WEST's decision to discontinue accounting
for the operations of U S WEST Communications in accordance with SFAS 71 was
based on the belief that the development of broadband technology, competition
and market conditions, more than prices established by regulators, will
determine the future revenues of U S WEST Communications. As a result of this
change, the remaining asset lives of U S WEST Communications' telephone plant
will be shortened to more closely reflect the useful economic life of such
plant. U S WEST Communications' accounting and reporting for regulatory purposes
will not be affected by the change. U S WEST Communications expects that it will
continue to work with regulators to set appropriate prices that reflect changing
market conditions, including shorter depreciation lives.
DISCONTINUED OPERATIONS
In June 1993, in connection with its decision to concentrate its resources
and efforts on developing its telecommunications business, U S WEST determined
to treat its capital assets business segment (the "Capital Assets Segment") as a
discontinued operation and announced its intention to dispose of the businesses
comprising that segment. In December 1993, U S WEST sold $2.0 billion of finance
receivables and the business of U S WEST Financial Services, Inc., one of the
businesses included in the Capital Assets Segment, to NationsBank Corporation.
The sale was in line with the Company's estimate. Proceeds from the sale of $2.1
billion were used to repay related debt and to reinvest in communications
businesses.
On October 12, 1993, Financial Security Assurance Holding Ltd. ("FSA"), an
affiliate of U S WEST within the Capital Assets Segment which provides financial
guarantee insurance policies for corporate and municipal clients, filed a
registration statement with respect to a proposed underwritten initial public
offering of 12 million shares of its common stock. In December 1993, the
proposed public offering was postponed indefinitely. U S WEST is continuing to
explore its strategic alternatives with respect to FSA, which may include a
public offering or a disposition of the business.
ADDITIONAL SECURITIES OFFERING
On August 23, 1993, U S WEST and its wholly owned subsidiary, U S WEST
Capital Funding, Inc. ("Capital Funding"), filed with the Commission a
Registration Statement on Form S-3 (the "August S-3") pursuant to which from
time to time U S WEST may offer shares of Common Stock and preferred stock, par
value $1.00 per share (the "Equity Securities"), and Capital Funding may offer
its notes, debentures or other debt securities (which will be unconditionally
guaranteed by U S WEST) for an aggregate offering price with the Equity
Securities of up to $1,500,000,000. U S WEST intends to use the net proceeds
from the sale by it of any Equity Securities for the same purposes as described
in "Use of Proceeds" below. The issuance and
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<PAGE>
sale of any shares of Common Stock pursuant to the August S-3 may have a
dilutive effect on the shares of Common Stock outstanding at the time of such
issuance.
On November 17, 1993, U S WEST issued 22,000,000 shares of Common Stock
pursuant to the August S-3, and received approximately $1.02 billion in net
offering proceeds (the "November Offering"). U S WEST has used the net proceeds
from the November Offering to reduce short-term indebtedness, including
indebtedness incurred in connection with the TWE Investment referred to above in
"Recent Developments--TWE Investment," and for general corporate purposes.
THE OFFERING
The Shares referred to herein are issuable upon the exercise of
non-transferable Rights to Purchase Common Stock directly from U S WEST on a
commission-free basis, at $ per Share, representing a 3% discount from the
average of the high and low trading prices of such stock on the NYSE on February
23, 1994.
The offering is part of the settlement of certain class action claims in
Rosenbaum v. U S WEST, Inc., a litigation filed against U S WEST and certain
individual defendants in the United States District Court for the District of
Colorado (the "Court"). The Settlement was approved by the Court on November 19,
1993.
USE OF PROCEEDS
The price per Share is $ . See "The Offering." Under the terms of
the Settlement, the number of Shares purchased by Class Members at this
discounted price is determined with reference to amounts previously tendered by
such Class Members. As of the close of business on February 22, 1994, the
deadline (subject to limited exceptions) for submission of such payments, U S
WEST had received an aggregate of approximately $ from Class Members
for application toward the purchase of Shares pursuant to the offering. However,
because amounts submitted by recipients of Rights to Purchase may exceed the
exact price of a whole number of Shares, and due to other factors, the aggregate
receipts by U S WEST and the maximum number of Shares issuable pursuant to the
offering are only estimates.
U S WEST expects to use the net proceeds from the sale of the Shares
offered hereby to reduce short-term indebtedness, including indebtedness
incurred in connection with the TWE Investment referred to above in "Recent
Developments--TWE Investment," and for general corporate purposes. As of
February 18, 1994, the short-term indebtedness being repaid with the proceeds of
the offering carried a weighted average interest cost of approximately 3.38% and
had been outstanding a weighted average of approximately 12 days.
BUSINESS OF U S WEST
GENERAL
U S WEST is a diversified global communications company engaged in the
telecommunications, directory publishing, marketing and, most recently,
entertainment services businesses. Telecommunications services are provided by U
S WEST's principal subsidiary to more than 25 million residential and business
customers in the U S WEST Region. Directory publishing, marketing and
entertainment services as well as cellular mobile communications services are
provided by other U S WEST subsidiaries to customers both inside and outside the
U S WEST Region. U S WEST had total assets in excess of $20 billion at December
31, 1993.
COMPETITIVE STRATEGY
U S WEST's competitive strategy is to become a leading provider of
interactive, integrated communications, entertainment and information services
in the U S WEST Region and other selected domestic and
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international markets. U S WEST intends to implement its competitive strategy by
focusing on three key objectives: (1) growth through the development of
broadband networks, continuation of the cable-telco expansion and broadened
wireless presence, (2) customer loyalty through continuous improvement in
customer service and (3) improved productivity through systems reengineering and
other cost controls. The strategy is directed both domestically (inside and
outside the U S WEST Region) and internationally.
U S WEST will continue to employ strategic alliances in new and developing
businesses. In addition to strategic alliances, the Company will make direct
investments in assets or businesses that are consistent with the Company's
competitive strategy. Such investment activities could require large amounts of
capital. Financing for any of these types of activities will come from a
combination of debt, equity and proceeds from the disposition of the Capital
Assets Segment and other assets or businesses which no longer fit U S WEST's
strategic objectives. See "Recent Developments--Discontinued Operations." The
Company may also seek new investors to raise capital for certain developing
businesses.
BASE BUSINESSES
In 1993, the Company announced its intention to build a "broadband," or
high speed, interactive telecommunications network capable of providing voice,
data and video services to customers in major metropolitan markets within the U
S WEST Region. Assuming FCC approval, U S WEST Communications anticipates
converting about 100,000 access lines to this technology by the end of 1994 and
500,000 access lines annually beginning in 1995. This network modernization
program will position U S WEST Communications to compete with all future
providers of voice, data and video services. Technical and marketing trials of
the broadband network will commence in the second quarter of 1994.
U S WEST Communications obtained approximately $200 million of revenues
from new products and services during 1993, an increase of approximately $65
million, or 47.0 percent, over 1992. Significant new products include voice
messaging, now three years old with an installed customer base exceeding
690,000, and Custom Local Area Signaling Services, which include features such
as name and number identification. To meet the demand for high speed data
communications, U S WEST Communications has introduced products such as frame
relay service, which enables companies with computer networks to exchange large
volumes of data. The Restructuring Plan described in "Recent
Developments--Restructuring" is supportive of U S WEST's objective to improve
customer service and increase productivity, and to continue to narrow its cost
of service disadvantage with current and potential competitors. Employee-related
costs comprise approximately 45 percent of the total operating costs of U S
WEST. The Company will continue its efforts to control these costs, primarily
through systems improvements and reductions in staffing. At U S WEST
Communications, the number of employees per ten thousand access lines decreased
by 8.7 percent in 1993, and has dropped 17.8 percent since 1990. The Company
anticipates that this trend will continue.
DEVELOPING BUSINESS--DOMESTIC
U S WEST is expanding its customer base and strengthening its national
out-of-region presence by acquiring or forming alliances with other
communications, entertainment and information services companies. The first
major step towards that goal was the TWE Investment described below in "Recent
Developments--TWE Investment."
In 1993, the Company's domestic cellular customer base grew to
approximately 600,000, up 45 percent from the year before. To maintain a high
growth rate, the Company is focusing significant attention on upgrading its
cellular systems and increasing its penetration into the consumer market.
Furthermore, the Company is anticipating increased competition as new personal
communications services ("PCS") enter the wireless market. The Company
anticipates that it will be a participant in PCS.
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DEVELOPING BUSINESS--INTERNATIONAL
In the international arena, U S WEST is focusing its efforts on certain
strategic businesses, primarily in the United Kingdom ("U.K."), where the
Company is able to participate directly in the convergence of cable TV and
telecommunications. The U.K. market is unique because its regulatory policies
allow cable TV operators to provide telephone service in their franchise areas.
Strategic alliances will be used internationally where U S WEST and its partners
can leverage their respective technological resources and management expertise.
During 1993, U S WEST continued expanding its international ventures.
TeleWest Communications ("TeleWest"), a joint venture with TeleCommunications
Inc., is the largest provider of combined cable TV and telephone service in the
U.K. With the 1993 purchase of seven franchises, TeleWest now owns all or part
of 24 franchises, encompassing 3.3 million homes. Also in 1993, four TeleWest
operating systems installed their own local telephone switches. All franchises
are expected to operate their own telephone switches by the end of 1994, thus
eliminating some costs to interconnect with other carriers' systems.
In the U.K., Mercury One-2-One, a 50-50 joint venture between U S WEST and
Cable & Wireless PLC, launched the world's first commercial personal
communications network ("PCN") in 1993. Mercury One-2-One's PCN is a form of
digital cellular communications designed to offer consumer users both a higher
quality of service and more features at lower prices than existing analog
cellular communications systems. Initial orders for the service are exceeding
expectations.
In December 1993, U S WEST sold a 29 percent investment in its Russian
ventures to seven institutional investors for $40 million, raising new funds for
investment in new telecommunications projects in Russia.
The Company's net investment in international ventures approximated $477
million at December 31, 1993, 70 percent of which is invested in the U.K. The
Company's future commitment to existing international ventures is currently
planned at about $450 million over the next five years. The Company will
continue to pursue opportunities in attractive local markets around the world
that fit its strategic objectives.
DESCRIPTION OF COMMON STOCK
GENERAL
U S WEST's authorized capital stock consists of 2,000,000,000 shares of
Common Stock without par value and 50,000,000 shares of Preferred Stock having a
par value of $1.00 per share. At the close of business on January 31, 1994,
there were 441,391,370 shares of Common Stock outstanding and no shares of
Preferred Stock outstanding.
The following summary does not purport to be complete and is subject in all
respects to the applicable provisions of the Colorado Corporation Code and U S
WEST's Articles of Incorporation (the "Articles of Incorporation").
COMMON STOCK
All holders of Common Stock have full voting rights and are entitled to one
vote for each share held of record on all matters submitted to a vote of the
shareholders. The Board of Directors of U S WEST is classified into three
classes of approximately equal size, one-third elected each year. Shareholders
do not have the right to cumulate votes in the election of directors and do not
have a right of redemption or any preferential right of subscription for any
securities of U S WEST, except as described below under "Rights Plan." There is
no sinking fund related to the Common Stock. All outstanding shares of Common
Stock are, and all shares of Common Stock offered hereby will, when issued, be
fully paid and nonassessable.
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Subject to preferences that may be applicable to any shares of Preferred
Stock outstanding at the time, holders of Common Stock are entitled to dividends
when and as declared by the Board of Directors from funds legally available
therefor and are entitled, in the event of liquidation, to share ratably in all
assets remaining after payment of liabilities.
CHANGE OF CONTROL
U S WEST's Articles of Incorporation include provisions designed to prevent
the use of certain tactics in connection with a potential takeover of U S WEST.
Article Nine of U S WEST's Articles of Incorporation includes a "fair price
provision" which requires the affirmative vote of 80% of the outstanding shares
of capital stock entitled to vote generally in the election of directors to
approve certain business combinations (including certain mergers, security
issuances, recapitalizations, liquidations and the sale, lease or transfer of a
substantial part of U S WEST's assets) involving U S WEST or a subsidiary and an
owner of 10% or more of the outstanding Common Stock ("related person"), unless
either (i) such business combination is approved by a majority of the directors
unaffiliated with the related person or (ii) the shareholders receive a "fair
price" for their holdings and other procedural requirements are met. A "fair
price" is an amount at least equal to the greater of (i) the highest price per
share paid by the related person for any shares acquired by it when it became a
related person or within two years prior to the announcement of the proposed
business combination, or (ii) the highest market value per share on the date of
such announcement or the date the related person became such. Except as provided
in Article Nine, the vote of a majority of the outstanding shares of capital
stock entitled to vote generally in the election of directors is necessary to
approve a plan of merger.
Article Nine also provides that a vote of 80% of the outstanding shares of
capital stock entitled to vote generally in the election of directors is
necessary to remove a member of the Board of Directors, and that the Bylaws may
be amended either by a vote of 80% of such outstanding shares or by the
affirmative vote of two-thirds of the members of the Board of Directors. Article
Nine may be amended by a vote of 80% of the outstanding shares unless the
amendment was approved by two-thirds of the Board of Directors, in which case
the amendment may be approved by a vote of sixty-six and two-thirds percent of
the outstanding shares.
RIGHTS PLAN
On April 7, 1989, the Board of Directors declared a dividend of one
preferred stock purchase right (the "Preferred Stock Purchase Right") for each
share of Common Stock, payable to holders of record of Common Stock on or after
April 19, 1989. Pursuant to the Rights Agreement dated as of April 7, 1989, one
Preferred Stock Purchase Right automatically attaches to and trades together
with each share of Common Stock issued by U S WEST, and will, therefore, attach
to each share of Common Stock offered hereby. The Preferred Stock Purchase
Rights will expire on April 6, 1999 unless redeemed earlier and will not be
exercisable or transferable separately from the shares of Common Stock to which
they are attached until the earlier of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired beneficial ownership of 20% or more of the
outstanding shares of Common Stock, other than pursuant to an offer for all
shares of Common Stock which the independent directors of U S WEST determine to
be fair to and in the best interests of U S WEST and its shareholders
("Acquisition Trigger Date") or (ii) 10 business days following a public
announcement of the commencement of a tender offer or exchange offer that would
result in the offeror beneficially owning 30% or more of the outstanding shares
of Common Stock ("Tender Offer Trigger Date").
At any time prior to an Acquisition Trigger Date the Preferred Stock
Purchase Rights are redeemable in whole but not in part by the Board of
Directors for $0.005 per Preferred Stock Purchase Right. The holder of a
Preferred Stock Purchase Right has no rights as a shareholder of U S WEST unless
and until such Preferred Stock Purchase Right is exercised.
8
<PAGE>
After an Acquisition Trigger Date, the Preferred Stock Purchase Rights may
be traded independently from the Common Stock, and each Preferred Stock Purchase
Right, except for those held by the Acquiring Person (which Preferred Stock
Purchase Rights will be void), will entitle the holder thereof to acquire shares
of Common Stock (or, in certain circumstances, property or other securities)
with a market value equal to two times the exercise price of the Preferred Stock
Purchase Right.
If, after an Acquisition Trigger Date, (i) U S WEST is acquired in a merger
or other business combination transaction in which U S WEST is not the surviving
corporation (other than a merger which follows an offer approved by independent
directors as described above) or (ii) more than 50% of U S WEST's assets or
earning power is sold or transferred (other than in transactions in the ordinary
course of business), each holder of a Preferred Stock Purchase Right, except for
those Preferred Stock Purchase Rights held by the Acquiring Person (which
Preferred Stock Purchase Rights will be void), will thereafter have the right to
acquire, upon exercise thereof, shares of common stock of the acquiring company
having a value equal to two times the exercise price of the Preferred Stock
Purchase Right.
After a Tender Offer Trigger Date, the Preferred Stock Purchase Rights may
be traded independently of the Common Stock, but remain redeemable by the Board
of Directors until an Acquisition Trigger Date. This provision allows U S WEST
to distribute the Preferred Stock Purchase Rights to shareholders in
circumstances when an Acquisition Trigger Date is likely to occur.
The Preferred Stock Purchase Rights have certain anti-takeover effects. The
Preferred Stock Purchase Rights will cause substantial dilution to a person or
group that attempts to acquire U S WEST unless the acquisition is conditional on
a substantial number of Preferred Stock Purchase Rights being acquired. The
Preferred Stock Purchase Rights, however, should not affect any prospective
offeror willing to make an offer at an equitable price and which is otherwise in
the best interests of U S WEST and its shareholders, as determined by the Board
of Directors. The Preferred Stock Purchase Rights should not interfere with any
merger or other business combination approved by the Board of Directors since
the Board of Directors may, at its option, redeem the Preferred Stock Purchase
Rights at any time until an Acquisition Trigger Date.
VALIDITY OF SHARES
The validity of the Shares of Common Stock offered hereby and certain legal
matters relating thereto will be passed upon for U S WEST by Stephen E. Brilz,
Senior Attorney and Assistant Secretary of U S WEST.
EXPERTS
The consolidated financial statements included in U S WEST's Annual Report
on Form 10-K for the year ended December 31, 1992, as well as the consolidated
financial statements and financial statement schedules included in U S WEST's
Current Report on Form 8-K dated August 20, 1993, are incorporated herein by
reference in reliance on the reports of Coopers & Lybrand, independent certified
public accountants, given upon the authority of that firm as experts in
accounting and auditing.
9
<PAGE>
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR
TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED
IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION
OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE
SECURITIES DESCRIBED IN THIS PROSPECTUS OR AN OFFER
TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER
OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF U S WEST
SINCE THE DATE OF THIS PROSPECTUS OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
--------------------------
TABLE OF CONTENTS
PAGE
-----------
Available Information.......................... 2
Incorporation of Certain Documents
by Reference................................. 2
U S WEST, Inc.................................. 3
Recent Developments............................ 3
The Offering................................... 5
Use of Proceeds................................ 5
Business of U S WEST........................... 5
Description of Common Stock.................... 7
Validity of Shares............................. 9
Experts........................................ 9
- ------------------------------------------------------
- ------------------------------------------------------
24,000,000 SHARES
U S WEST, INC.
COMMON STOCK
(NO PAR VALUE)
------------------------
[U S WEST LOGO]
------------------------
- ------------------------------------------------------
- ------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the expenses expected to be incurred in
connection with the offering described in this Registration Statement. All
amounts are estimated except the Securities and Exchange Commission filing fee.
<TABLE>
<S> <C>
Securities and Exchange Commission filing fee.............................................. $ 341,470
Blue Sky fees and expenses................................................................. 5,000
Stock Exchange listing fees................................................................ 121,800
Printing and engraving expenses............................................................ 70,000
Accountant's fees and expenses............................................................. 12,500
Legal fees and expenses.................................................................... 75,000
Miscellaneous expenses..................................................................... 4,230
-----------
Total............................................................................ $ 630,000
-----------
-----------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Bylaws of U S WEST provide for the indemnification of directors and
officers to the extent permissible under applicable law. Section 7-3-101.5 of
the Colorado Code specifies the circumstances under which a corporation may
indemnify its directors, officers, employees or agents. For acts done in a
person's "official capacity" the Colorado Code generally requires that an act be
done in good faith and in a manner reasonably believed to be in the best
interests of the corporation. In all other civil cases, the person must have
acted in good faith and in a way that was not opposed to the corporation's best
interests. In criminal actions or proceedings the Code imposes an additional
requirement that the actor had no reasonable cause to believe his conduct was
unlawful. In any proceeding by or in the right of the corporation, or charging a
person with the improper receipt of a personal benefit, no indemnification,
except for court-ordered indemnification for reasonable expenses incurred, can
be made. Indemnification is mandatory when any director or officer is wholly
successful, on the merits or otherwise, in defending any civil or criminal
proceeding.
The directors and officers of U S WEST are covered by insurance policies
indemnifying against certain liabilities, including certain liabilities arising
under the Securities Act of 1933, as amended (the "Securities Act"), which might
be incurred by them in such capacities and against which they cannot be
indemnified by U S WEST.
ITEM 16. EXHIBITS.
Exhibits identified in parentheses below are on file with the Securities
and Exchange Commission and are incorporated herein by reference to such
previous filings. All other exhibits are provided as part of this electronic
transmission.
<TABLE> <CAPTION>
EXHIBIT
NO. DESCRIPTION
<S> <C>
- --------- --------------------------------------------------------------------------------------------------------
(4-A.) --Articles of Incorporation of U S WEST, Inc. dated September 23, 1983 (Exhibit 3a to Registration
Statement No. 2-87861).
(4-B.) --Articles of Amendment to the Articles of Incorporation of U S WEST, Inc. dated June 6, 1988 (Exhibit
3b to Form 10-K, date of report March 29, 1989, File No. 1-8611).
(4-C.) --Articles of Amendment to the Articles of Incorporation of U S WEST, Inc. dated May 3, 1991 (Exhibit 3c
to Form SE filed on March 5, 1992, File No. 1-8611).
</TABLE>
II-1
<PAGE>
<TABLE> <CAPTION>
EXHIBIT
NO. DESCRIPTION
<S> <C>
- --------- --------------------------------------------------------------------------------------------------------
(4-D.) --Bylaws of U S WEST, Inc. as amended February 5, 1993 (Exhibit 3b to Form 10-K, date of report March
19, 1993, File No. 1-8611).
(4-E.) --Rights Agreement dated as of April 7, 1989 between U S WEST, Inc. and American Transtech Inc., as
Rights Agent (Exhibit 4d to Form SE filed on April 11, 1990, File No. 1-8611).
(4-F.) --Agreement for Appointment and Acceptance of Appointment as Successor Rights Agent dated July 15, 1992
between U S WEST, Inc. and State Street Bank and Trust Company (Exhibit 4(e) of Registration Statement
No. 33-50047 filed on August 23, 1993).
5. --Opinion of counsel as to the legality of the securities being registered.*
23.1 --Consent of Coopers & Lybrand, independent auditors.
23.2 --Consent of counsel (included in Exhibit 5).
24 --Powers of attorney.*
</TABLE>
- ---------------
* Previously filed.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended (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 the registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, 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, if any, of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by U S WEST of expenses incurred or
paid by a director, officer or controlling person of U S WEST 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, the
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 Act and will be governed by the final adjudication of such
issue.
The undersigned hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, U S WEST, Inc.
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this Registration
Statement or amendment thereto to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Denver, State of Colorado, on the 23rd
day of February, 1994.
U S WEST, INC.
By /s/ STEPHEN E. BRILZ
...................................
Stephen E. Brilz
Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement or amendment thereto has been signed by the following
persons in the capacities and on the date indicated.
PRINCIPAL EXECUTIVE OFFICER:
RICHARD D. MCCORMICK* Chairman of the Board,
President and Chief Executive
Officer
PRINCIPAL FINANCIAL AND
ACCOUNTING OFFICER:
JAMES M. OSTERHOFF* Executive Vice President and
Chief Financial Officer
DIRECTORS:
RICHARD B. CHENEY*
REMEDIOS DIAZ-OLIVER*
GRANT A. DOVE*
MARY M. GATES*
ALLAN D. GILMOUR*
PIERSON M. GRIEVE*
SHIRLEY M. HUFSTEDLER*
ALLEN F. JACOBSON*
RICHARD D. MCCORMICK*
FRANK P. POPOFF*
GLEN L. RYLAND*
JERRY O. WILLIAMS*
DANIEL YANKELOVICH*
*BY /S/ STEPHEN E. BRILZ
.........................................................................
Stephen E. Brilz
Attorney-in-Fact
Dated: February 23, 1994
II-3
<PAGE>
<TABLE> <CAPTION>
EXHIBIT
NO. INDEX TO EXHIBITS
<S> <C>
- --------- --------------------------------------------------------------------------------------------------------
(4-A.) --Articles of Incorporation of U S WEST, Inc. dated September 23, 1983 (Exhibit 3a to Registration
Statement No. 2-87861).
(4-B.) --Articles of Amendment to the Articles of Incorporation of U S WEST, Inc. dated June 6, 1988 (Exhibit
3b to Form 10-K, date of report March 29, 1989, File No. 1-8611).
(4-C.) --Articles of Amendment to the Articles of Incorporation of U S WEST, Inc. dated May 3, 1991 (Exhibit 3c
to Form SE filed on March 5, 1992, File No. 1-8611).
(4-D.) --Bylaws of U S WEST, Inc. as amended February 5, 1993 (Exhibit 3b to Form 10-K, date of report March
19, 1993, File No. 1-8611).
(4-E.) --Rights Agreement dated as of April 7, 1989 between U S WEST, Inc. and American Transtech Inc., as
Rights Agent (Exhibit 4d to Form SE filed on April 11, 1990, File No. 1-8611).
(4-F.) --Agreement for Appointment and Acceptance of Appointment as Successor Rights Agent dated July 15, 1992
between U S WEST, Inc. and State Street Bank and Trust Company (Exhibit 4(e) of Registration Statement
No. 33-50047 filed on August 23, 1993).
5. --Opinion of counsel as to the legality of the securities being registered.*
23.1 --Consent of Coopers & Lybrand, independent auditors.
23.2 --Consent of counsel (included in Exhibit 5).
24 --Powers of attorney.*
</TABLE>
- ---------------
* Previously filed.
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement on Form S-3 of our reports dated January 21, 1993, on our
audits of the consolidated financial statement schedules and the
consolidated financial statement schedules of U S WEST, Inc. (the
"Company"), as of December 31, 1992 and 1991, and for the three
years ended December 31, 1992, 1991 and 1990. We also consent to
the incorporation by reference in the Registration Statement on
Form S-3 of our report dated August 20, 1993, on our audits of the
consolidated financial statements of the Company for the same
periods, reclassified for the effect of the Company's discontinuing
the operations of its Capital Assets Segment. We also consent to
the reference to our firm under the caption "Experts".
/s/ COOPERS & LYBRAND
Denver, Colorado
February 23, 1994
