As filed with the Securities and Exchange Commission on November 1, 2001
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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U.S. BANCORP
(Exact name of registrant as specified in its charter)
Delaware 41-0255900
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
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U.S. Bank Place
601 Second Avenue
Minneapolis, Minnesota 55402-4302
(612) 973-1111
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
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Lee R. Mitau, Esq.
U.S. Bancorp
601 Second Avenue
Minneapolis, Minnesota 55402-4302
(612) 973-1111
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies to:
Michael D. Nathan, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, NY 10017-3954
(212) 455-2000
Fax: (212) 455-2502
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Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement.
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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, check the following box. /x/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. /_/
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. /_/
If delivery of the Prospectus is expected to be made pursuant to Rule
434, please check the following box. /_/
CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum
Amount to be Offering Price Per Aggregate Offering Amount of
Title of Securities to be Registered Registered (1) Security (2) Price (2) Registration Fee
Contingent Zero-Coupon Accreting $1,483,179,000 74.0% $1,097,552,460 $274,389
Redeemable SecuritiesSM (CZARSSM)
(Convertible Senior Notes) Due 2021
Common Stock, $.01 par value per 35,808,390 (3) (3) (3) (4)
share
(SM) Servicemark of Salomon Smith Barney Inc.
(1) The CZARS were issued at an original price of $741.65 per $1,000
principal amount at maturity, which represents an aggregate initial
issue price of approximately $1,099,999,705 and an aggregate principal
amount at maturity of $1,483,179,000.
(2) This estimate is made pursuant to Rule 457(c) of the Securities Act
solely for the purpose of determining the registration fee. The above
calculation is based on the average of the bid and ask prices for the
Registrant's CZARS on PORTAL(SM) at closing on October 29, 2001, as
reported to the Registrant by Salomon Smith Barney Inc.
(3) Includes shares of common stock issuable upon conversion of the CZARS at
the rate of 24.1430 shares of Common Stock for each $1,000 principal
amount at maturity of the CZARS. This registration statement is
registering the resale of the CZARS and the underlying shares of common
stock into which the CZARS are convertible. Pursuant to Rule 416 under
the Securities Act, the number of shares of common stock registered
hereby shall include an indeterminate number of additional shares of
common stock that may be issuable as a result of antidilution
adjustments. Any shares of common stock issued upon conversion of the
CZARS will be issued for no additional consideration.
(4) Pursuant to Rule 457(i), there is no additional filing fee with respect
to the shares of common stock issuable upon conversion of the CZARS
because no additional consideration will be received in connection with
the exercise of the conversion privilege.
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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 that specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the U.S. Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING SECURITYHOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING
OFFERS TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.
Subject to completion, dated November 1, 2001
PROSPECTUS
$1,483,179,000
USBANCORP [Registered Trademark]
Contingent Zero-Coupon Accreting Redeemable SecuritiesSM (CZARSSM)
(Convertible Senior Notes) Due 2021
And
Common Stock Issuable upon
Conversion of the CZARS
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We issued the CZARS in a private placement in August 2001 at an
issue price of $741.65 per CZARS. Selling securityholders will use this
prospectus to resell from time to time their CZARS and the shares of our
common stock issuable upon conversion of the CZARS.
Except under circumstances described below, we will not pay cash
interest on the CZARS before maturity. Instead, on August 6, 2021, the
maturity date of the CZARS, holders of CZARS will receive $1,000 for each
CZARS. The issue price per CZARS of $741.65 represented a yield to maturity of
1.50% per year calculated from August 6, 2001. If certain tax-related events
occur and we so elect, the CZARS will cease to accrete original issue discount
and cash interest will accrue at a rate of 1.50% per annum on the restated
principal amount and be payable semi-annually. Each CZARS has a principal
amount at maturity of $1,000.
Holders may convert their CZARS at any time on or before the
maturity date initially into 24.1430 shares of our common stock for each CZARS
if (1) the sale price of our common stock issuable upon conversion of a CZARS
reaches specified thresholds that decrease over time, (2) the credit rating of
the CZARS is reduced to below specified thresholds, (3) the CZARS are called
for redemption or (4) specified corporate transactions have occurred. The
conversion rate may be adjusted as described in this prospectus. The
conversion rate will not be adjusted for increases in accreted value.
We may not redeem the CZARS before August 6, 2003. We may, at any
time on or after August 6, 2003, redeem the CZARS for cash in an amount equal
to the accreted value of the CZARS, plus accrued and unpaid interest, if any.
Holders may require us to purchase the CZARS for cash on the following dates
generally at the following prices: August 6, 2002 at $752.82; August 6, 2003
at $764.15, August 6, 2004 at $775.66, August 6, 2006 at $799.19, August
6, 2008 at $823.44, August 6, 2011 at $861.19, and August 6, 2016 at $928.01.
In addition, if we experience specified types of fundamental changes before
August 6, 2003, holders may require us to purchase the CZARS for an amount
equal to the accreted value of the CZARS, plus accrued and unpaid interest, if
any.
Commencing with the six-month period beginning August 6, 2003, we
will pay contingent interest to the holders of CZARS during specified
six-month periods if the average price of a CZARS for the five trading day
reference period described in this prospectus equals 120% or more of the
accreted value of a CZARS on the day immediately preceding the relevant
six-month period. The amount of contingent interest payable per CZARS in
respect of any six-month period will equal the greater of (1) cash dividends
paid by us per share on our common stock during that six-month period
multiplied by the number of shares of common stock issuable upon conversion of
a CZARS and (2) .17575% of accreted value. For a discussion of the special
regulations governing contingent payment debt instruments, see "Certain United
States Federal Income Tax Considerations--Classification of the CZARS"
beginning on page 29.
The CZARS are unsecured and rank equally with our other unsecured
senior indebtedness.
Our common stock is listed on the New York Stock Exchange under the
symbol "USB."
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Investing in the CZARS involves risks. See "Risk Factors" beginning
on page 8 of this prospectus.
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We will not receive any of the proceeds from the sale of the CZARS or
shares of common stock by any of the selling securityholders. The CZARS and
the shares of common stock may be offered and sold from time to time directly
by the selling securityholders or alternatively through underwriters or
broker-dealers or agents. The CZARS and the shares of common stock may be sold
in one or more transactions at fixed prices, at prevailing market prices at
the time of sale, at varying prices determined at the time of sale, or at
negotiated prices. If the CZARS and the shares of common stock are sold
through underwriters or broker-dealers or agents, the selling securityholder
will be responsible for underwriting discounts or commissions or agent's
commissions. See "Plan of Distribution." The selling securityholders may be
deemed to be "underwriters" as defined in the Securities Act of 1933, as
amended. Any profits realized by the selling securityholders may be deemed to
be underwriting commissions. If the selling securityholders use any
broker-dealers, any commissions paid to broker-dealers and, if broker-dealers
purchase any CZARS or common stock as principals, any profits received by
those broker-dealers on the resale of the CZARS or common stock, may be deemed
to be underwriting discounts or commissions under the Securities Act.
Neither the Securities and Exchange Commission, any state securities
commission nor any other regulatory body has approved or disapproved of these
securities or determined if this prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
The date of this prospectus is , 2001.
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We have not authorized anyone to give any information or make any
representation about the offering that is different from, or in addition to,
that contained in this prospectus or in any of the materials that we have
incorporated by reference into this prospectus. Therefore, if anyone does give
you information of this type, you should not rely on it. If you are in a
jurisdiction where offers to sell, or solicitations of offers to purchase, the
securities offered by this document are unlawful, or if you are a person to
whom it is unlawful to direct these types of activities, then the offer
presented in this document does not extend to you. The information contained
in this document speaks only as of the date of this document unless the
information specifically indicates that another date applies.
TABLE OF CONTENTS
Page
Where You Can Find More Information.........................................2
Special Note Regarding Forward Looking Statements...........................3
U.S. Bancorp................................................................4
Summary of the Offering.....................................................5
Risk Factors................................................................8
Price Range of Common Stock and Dividend Policy.............................9
Use of Proceeds............................................................10
Description of the CZARS...................................................11
Description of Common Stock................................................25
Certain United States Federal Income Tax Considerations....................28
Certain ERISA Considerations...............................................35
Selling Securityholders....................................................37
Plan of Distribution.......................................................40
Legal Matters..............................................................42
Experts....................................................................42
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the U.S. Securities and Exchange Commission (the "SEC")
under the Securities Exchange Act of 1934, as amended. You may read and copy
any document that we file at the SEC's public reference rooms in Washington,
D.C., New York, New York and Chicago, Illinois. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to the public from the SEC's web site at
http://www.sec.gov. Our SEC filings are also available at the offices of the
New York Stock Exchange. For further information on obtaining copies of our
public filings at the New York Stock Exchange, you should call (212) 656-5060.
This prospectus "incorporates by reference" the information that we
have filed with the SEC under the Exchange Act. This means that we are
disclosing important information to you by referring you to those documents.
The information incorporated by reference is deemed to be part of this
prospectus. We incorporate by reference the following documents listed below
and any future filings made with the SEC under Sections 13(a), 13(c), 14, or
15(d) of the Exchange Act:
o Annual Report on Form 10-K for the year ended December 31,
2000;
o Quarterly Report on Form 10-Q for the quarters ended
March 31, 2001 and June 30, 2001; and
o Current Reports on Form 8-K filed on January 22, February 28,
March 6, March 12, March 16, April 17 (two reports), April 23,
May 3, July 17, July 25, July 31, August 6, August 27, October
17 and October 31, 2001.
Any statement contained in a document incorporated or deemed to be
incorporated by reference in this prospectus will be considered to be modified
or superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus or in any subsequently filed document that is or
is deemed to be incorporated by reference modifies or supersedes that
statement. Any statement that is modified or superseded will not, except as so
modified or superseded, constitute a part of this prospectus.
You may request a copy of these filings at no cost, by writing or
telephoning us at the following address:
U.S. Bancorp
601 Second Avenue South
Minneapolis, Minnesota 55402
Attn: Investor Relations Department
(612) 973-2263
Unless otherwise indicated, currency amounts in this prospectus and
in any applicable supplement are stated in U.S. dollars.
2
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus, including documents incorporated by reference in
this prospectus, contains forward-looking statements. Statements that are not
historical or current facts, including statements about beliefs and
expectations, are forward-looking statements. Forward-looking statements are
subject to risks and uncertainties that could cause actual results to differ
materially from those anticipated. Some of these risks and uncertainties
include the following, in addition to those described in our reports on file
with the SEC:
o Our investments in our consumer banking, payment systems and
wealth management business and in our Internet development
could require additional incremental spending, and might not
produce expected deposit and loan growth and anticipated
contributions to earnings;
o general economic or industry conditions could be less
favorable than expected, resulting in a deterioration in
credit quality, a change in the allowance for credit losses,
or a reduced demand for credit or fee-based products and
services;
o changes in the domestic interest rate environment could reduce
net interest income and could increase credit losses;
o the conditions of the securities markets could change,
adversely affecting revenues from capital markets businesses,
the value or credit quality of our on-balance sheet and
on-balance sheet assets, or the availability and terms of
funding necessary to meet liquidity needs;
o changes in the extensive laws, regulations and policies
governing financial services companies could alter our business
environment or affect operations;
o the potential need to adapt to industry changes in information
technology systems, on which we are highly dependent, could
present operational issues or require significant capital
spending;
o competitive pressures could intensify and affect our
profitability, including as a result of continued industry
consolidation, the increased availability of financial
services from non-banks, technological developments such as
the Internet, or bank regulatory reform; and
o acquisitions, including that described below under "U.S.
Bancorp", may not produce revenue enhancements or cost savings
at levels or within time-frames originally anticipated, or may
result in unforeseen integration difficulties.
You should consider the areas of risk described above in connection
with any forward-looking statements that we may make in this prospectus.
Forward-looking statements speak only as of the date they are made. Except for
our ongoing obligations to disclose material information under the federal
securities laws, we undertake no obligation to update any forward-looking
statements, whether as a result of new information, future events or
otherwise. See "Where You Can Find More Information".
3
U.S. BANCORP
U.S. Bancorp is the organization created by the acquisition by
Firstar Corporation of the former U.S. Bancorp of Minneapolis. The new company
retained the U.S. Bancorp name. We are a multi-state financial services
holding company headquartered in Minneapolis, Minnesota. We are incorporated
in Delaware and provide financial services as a financial holding company and
a bank holding company registered under the Bank Holding Company Act. We
provide a full range of financial services, including lending and depository
services, through more than 2,200 banking offices principally in 24 states. We
also engage in credit card, merchant and automated teller machine, or ATM,
processing; mortgage banking; insurance; trust and investment management;
brokerage; leasing; and investment banking activities, principally in domestic
markets. As of June 30, 2001, we and our subsidiaries had consolidated assets
of $165.2 billion, consolidated deposits of $106.9 billion and total
shareholders' equity of $15.5 billion.
Our banking subsidiaries provide an array of banking services to both
domestic and foreign customers and correspondent banks. These banking
subsidiaries range in size from less than $1.0 million to over $100 billion in
deposits. The consumer banking business delivers products and services to the
broad consumer market and small businesses through our banking offices,
telemarketing, on-line services, direct mail and ATMs. This business
encompasses community banking, metropolitan banking, small business banking,
consumer lending, mortgage banking and investment sales through our banking
branches. Our network of 5,200 branded ATMs offers customers an additional
banking convenience. The payment services division provides customers with
consumer and business credit cards, corporate and purchasing services, lines
of credit, ATM processing and merchant processing. Through this division, we
are the largest provider of VISA[Registered Trademark] corporate and
purchasing cards in the world. Our wholesale banking divisions offer lending,
depository, treasury management and other financial services to an array of
middle market, large corporate and public sector clients including
institutional organizations, government entities and other financial
institutions. Depository services include checking accounts, savings accounts
and time certificates of deposits. Ancillary services, such as treasury
management, include receivable lockbox collection, foreign exchange and
investment services. Additionally, our bank and trust subsidiaries provide a
full range of fiduciary services for individuals, estates, foundations,
business corporations and charitable organizations. We are one of the largest
providers of corporate trust services in the nation.
Our non-banking subsidiaries offer a variety of products and
services. Our wholly-owned subsidiary, U.S. Bancorp Piper Jaffray, Inc.,
engages in equity and fixed income trading activities, offers investment
banking and underwriting services to corporate and public sector customers and
provides financial advisory services and securities, mutual funds annuities
and insurance products to customers and regionally based businesses through a
network of over 100 offices.
Our principal executive offices are located at 601 Second Avenue
South, Minneapolis, Minnesota 55402-4302, and our telephone number is (612)
973-1111.
For more information about us, see our documents incorporated by
reference in this prospectus as described under the section "Where You Can
Find More Information."
4
SUMMARY OF THE OFFERING
CZARS Offered..................... $1,483,179,000 principal amount at
maturity of Contingent Zero-Coupon
Accreting Redeemable Securities
(Convertible Senior Notes) Due 2021,
or CZARS. We will not pay cash interest
on the CZARS before maturity, other
than as described below under
"Description of the CZARS--Optional
conversion to semi-annual cash pay
CZARS upon Tax Event" and "Description
of the CZARS--Contingent interest."
Each CZARS was issued at a price of
$741.65 and a principal amount at
maturity of $1,000.
Maturity.......................... August 6, 2021.
Yield to Maturity of CZARS........ 1.50% per year, computed on a
semi-annual bond equivalent basis,
calculated from August 6, 2001.
Conversion Rights................. Holders may convert their CZARS at any
time before the close of business on
August 6, 2021 if the average per share
sale price of our common stock for
the 20 trading days immediately before
the conversion date is equal to or
greater than a specified percentage,
beginning at 120% and declining 1/2%
each year thereafter until it reaches
110% at maturity, of the accreted
value of a CZARS, divided by the
conversion rate.
Holders may also convert CZARS
regardless of the sale price of our
common stock, in multiples of $1,000
principal amount at maturity, at any
time after:
o the credit rating assigned to the
CZARS by any two of Moody's
Investors Service, Inc., or
Moody's, Standard & Poor's
Ratings Group, or S&P, or Fitch
IBCA Duff & Phelps, or Fitch, are
reduced below Baa1, BBB and
BBB+, respectively, or the CZARS
are no longer rated by any two of
these ratings services;
o we call the CZARS for redemption;
o we make specified distributions to
our shareholders; or
o we become a party to a
consolidation, merger or binding
share exchange as a result of
which our common stock would be
converted into cash or property
(other than securities).
For each CZARS converted, we will
deliver 24.1430 shares of our common
stock. The conversion rate may be
adjusted under some circumstances, but
will not be adjusted for increases in
accreted value or accrued and unpaid
interest.
Your right to surrender CZARS for
conversion will expire at the close of
business on August 6, 2021.
Ranking........................... The CZARS are our general obligations
and are not secured by any collateral.
Your right to payment under these CZARS
are:
o junior to the rights of our
secured creditors to the extent
of their security in our assets;
o equal with the rights of
creditors under our other
unsecured unsubordinated debt,
including our revolving credit
facilities;
5
o senior to the rights of creditors
under debt expressly subordinated
to these CZARS; and
o effectively subordinated to
creditors of our subsidiaries.
Contingent Interest............... We will pay contingent interest to the
holders of CZARS during any six-month
period from August 6 to February 5 and
from February 6 to August 5, commencing
with the six month period beginning
August 6, 2003, if the average price
of the CZARS for the five trading days
ending on the second trading day
immediately preceding the relevant
six-month period equals 120% or more
of the accreted value of the CZARS on
the day immediately preceding the
beginning of the relevant six-month
period. If we declare a dividend for
which the record date falls before the
first day of a six-month period but
the payment date falls within the
six-month period, then the relevant
period for determining the average
CZARS price will be the five trading
days ending on the second trading day
immediately preceding that record date.
The amount of contingent interest
payable per CZARS in respect of any
six-month period will equal the greater
of (1) cash dividends paid by us per
share on our common stock during that
six-month period multiplied by the
number of shares of common stock
issuable upon conversion of a CZARS
and (2) .17575% of the accreted value
of the CZARS. See "Description of the
CZARS--Contingent interest."
Tax ............................. We and each holder will agree in the
indenture to treat the CZARS as
contingent payment debt instruments
for United States federal income tax
purposes. As a holder of a CZARS, you
will agree to accrue original issue
discount on a constant yield to
maturity basis at a rate comparable to
the rate at which we would borrow in
a noncontingent, nonconvertible
borrowing, 7.03%, even though the
CZARS will have a significantly lower
yield to maturity. You will recognize
taxable income significantly in excess
of cash received, if any, while the
CZARS are outstanding. Additionally,
you will generally be required to
recognize ordinary income on the gain,
if any, realized (including the fair
market value of stock received) on a
sale, exchange, conversion or
redemption of the CZARS. See "Certain
United States Federal Income Tax
Consequences." The application of the
contingent payment debt rules to the
CZARS is uncertain and no ruling will
be obtained from the Internal Revenue
Service. You should consult your own
tax advisor concerning the tax
consequences of owning the CZARS.
Sinking Fund...................... None.
Optional Redemption............... We may not redeem the CZARS before
August 6, 2003. We may, at any time on
or after August 6, 2003, redeem for
cash all or a portion of the CZARS at
their accreted value, plus accrued and
unpaid interest, if any. Indicative
redemption prices are set forth in
this prospectus on page 15.
Purchase of the CZARS by Us
at the Option of the Holder... Holders may require us to purchase
their CZARS on any one of the following
dates at the following purchase prices
in cash plus accrued and unpaid
interest, if any:
o On August 6, 2002 at a price of
$752.82 per CZARS;
o On August 6, 2003 at a price of
$764.15 per CZARS;
o On August 6, 2004 at a price of
$775.66 per CZARS;
o On August 6, 2006 at a price of
$799.19 per CZARS;
o On August 6, 2008 at a price of
$823.44 per CZARS;
6
o On August 6, 2011 at a price of
$861.19 per CZARS;
o On August 6, 2016 at a price of
$928.01 per CZARS;
If we elect to have cash interest
accrue on the CZARS, as provided below,
the purchase price will be adjusted as
described below.
Optional Conversion to Semi-
Annual Cash Pay CZARS
upon a Tax Event .............. From and after the occurrence of a Tax
Event, as defined in this prospectus,
at our option, the CZARS will cease to
accrue original issue discount, and
cash interest will accrue on each
CZARS from the date on which we
exercise the option at the rate of
1.50% per year on the restated
principal amount (i.e., the accreted
value of the CZARS on the later of the
date of the Tax Event and the date we
exercise the option) and will be
payable semi-annually on the interest
payment dates of February 6 and August
6 of each year to holders of record at
the close of business on each regular
record date immediately preceding the
relevant interest payment date.
Interest will be computed on the basis
of a 360-day year comprised of twelve
30-day months and will initially
accrue from the option exercise date,
and thereafter from the last date to
which interest has been paid. In such
an event, the redemption prices,
purchase prices for purchases of CZARS
at the option of holders and
Fundamental Change purchase prices,
will be adjusted as described under
"Description of the CZARS--Conversion
rights." There will be no changes in a
holder's conversion rights in the
event we elect to have cash interest
accrue on the CZARS.
Fundamental Change................ Upon the occurrence of a Fundamental
Change, as defined in this prospectus,
occurring before August 6, 2003,
involving us, each holder may require
us to purchase for cash all or a
portion of that holder's CZARS. The
purchase price will be equal to the
accreted value of the CZARS on the date
of purchase, plus accrued and unpaid
interest, if any. See "Description of
the CZARS--Fundamental Change permits
holders to require us to purchase
CZARS."
Use of Proceeds................... We will not receive any of the proceeds
from the sale by any selling
securityholder of the CZARS or the
shares of common stock issuable upon
conversion of the CZARS.
Global Securities................. The CZARS have been issued in book
entry form, which means that they are
represented by one or more permanent
global securities registered in the
name of The Depository Trust Company,
or DTC. The global securities have
been deposited with the trustee as
custodian for DTC. See "Description of
the CZARS--Book entry, delivery and
form."
Trading........................... The CZARS issued in the initial
placement are eligible for trading on
the Private Offerings, Resales and
Trading through Automatic Linkages
Market commonly referred to as the
Portal Market. CZARS sold using this
prospectus, however, will no longer be
eligible for trading in the PORTAL
system. We do not intend to list the
CZARS on any national securities
exchange or automated quotation system.
Our common stock is listed on the New
York Stock Exchange under the symbol
"USB."
Risk Factors...................... An investment in the CZARS or shares of
common stock issuable upon conversion
of the CZARS involves risks. You
should carefully consider all the
information in this prospectus. In
particular, you should evaluate the
specific risk factors set forth under
"Risk Factors" beginning on page 8.
7
RISK FACTORS
You should consider carefully the following risks in addition to all
the other information included or incorporated by reference in this
prospectus, including the Special Note Regarding Forward-Looking Statements,
before deciding to invest in the CZARS.
If we experience a Fundamental Change, we may be unable to purchase
the CZARS you hold as required under the indenture.
Upon the occurrence of a Fundamental Change, we must make an offer
to purchase all of the outstanding CZARS. If a Fundamental Change has occurred
under the indenture, a change of control might also occur under any other
indenture or other agreement governing our then-existing debt or might result
in the acceleration of the maturity of any of our then existing indebtedness.
If a Fundamental Change were to occur or we were required to purchase
outstanding CZARS as described under "Description of the CZARS--Purchase of
CZARS at the option of the holder," we cannot assure you that we would have
sufficient funds to pay the purchase price for all CZARS and amounts due under
other indebtedness that we may be required to purchase or repay. If we fail to
purchase the CZARS when required upon a Fundamental Change, an event of
default will result with respect to the CZARS.
An active trading market for the CZARS may not develop.
Prior to the initial placement of the CZARS, there was no trading
market for the CZARS. Although the initial purchasers have advised us that
they currently intend to make a market in the CZARS, they are not obligated to
do so and may discontinue market making activities at any time without notice.
In addition, their market making activity will be subject to the limits
imposed by the Securities Act and the Exchange Act.
We cannot assure you that an active trading market for the CZARS
will develop or as to the liquidity or sustainability of any trading market
for the CZARS, the ability of the holders to sell their CZARS or the price at
which holders of the CZARS will be able to sell their CZARS. Future trading
prices of the CZARS will depend on many factors, including, among other
things, prevailing interest rates, the market for similar securities, the
price of our common stock, our performance and other factors.
Investment in the CZARS will result in the yearly inclusion in your
income taxable income of amounts significantly in excess of cash received
while the CZARS are outstanding.
We and each holder agree in the indenture to treat the CZARS as
contingent payment debt instruments subject to the contingent payment debt
regulations. As a result, you will be required to include amounts in income,
as original issue discount, in advance of the cash you receive on the CZARS.
The rate at which you will accrue this original issue discount will be
comparable to the rate at which we would borrow in a noncontingent,
nonconvertible borrowing, even though the CZARS have a significantly lower
yield to maturity. You will recognize taxable income significantly in excess
of cash received while the CZARS are outstanding. In addition, under the
indenture, you will recognize taxable income upon the conversion of the CZARS
equal to the difference between the fair market value of the common stock
received and your basis in the CZARS. Gain or loss upon a sale, exchange or
conversion will be ordinary income. See "Certain United States Federal Income
Tax Consequences."
Your claim against us will be limited if a bankruptcy proceeding is
commenced against us.
If a bankruptcy proceeding is commenced in respect of us, the claim
of the holder of a CZARS is, under Title 11 of the United States Code, limited
to the issue price of the CZARS plus that portion of the original issue
discount that has accrued from the date of issue to the commencement of the
proceeding.
8
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
Our common stock is listed and traded on the New York Stock Exchange
("NYSE") under the symbol "USB." The following table provides, for the
calendar quarters indicated, the high and low closing sales prices per share
on the NYSE for the periods shown below as reported on the NYSE and dividends
per share paid during those periods. The table reflects price and dividend
history for Firstar Corporation before the acquisition of U.S. Bancorp
effective February 27, 2001.
Dividends
NYSE Sale Price Common
High Low Stock
Period
1999:
First Quarter.............................. $31.85 $27.42 $.10
Second Quarter............................. 34.56 26.25 .10
Third Quarter.............................. 29.44 22.31 .10
Fourth Quarter............................. 29.38 20.25 .1625
2000:
First Quarter.............................. 24.63 17.00 .1625
Second Quarter............................. 27.75 21.06 .1625
Third Quarter.............................. 25.00 19.75 .1625
Fourth Quarter............................. 24.25 15.63 .1625
2001:
First Quarter.............................. 25.63 19.25 .1875
Second Quarter............................. 23.49 20.86 .1875
Third Quarter.............................. 25.02 19.38 .1875
Fourth Quarter through October 29.......... 22.70 16.81 --
The amount of future common stock dividends will depend on earnings,
financial condition, the last capital requirements and other factors, and will
be determined by the directors on a quarterly basis.
As of September 30, 2001, there were approximately 94,792 direct
holders of our common stock.
9
USE OF PROCEEDS
We will not receive any of the proceeds from the sale by any selling
securityholder of the CZARS or the shares of common stock issuable upon
conversion of the CZARS.
10
DESCRIPTION OF THE CZARS
We issued the CZARS under an indenture dated as of October 1, 1991,
between us (as successor to First Bank System, Inc.) and Citibank, N.A., as
trustee, as supplemented by a supplemental indenture to the indenture, dated
as of August 6, 2001. References to the indenture include the indenture as
supplemented by the supplemental indenture.
The following description is only a summary of the material
provisions of the CZARS and the indenture. Because the following description
is only a summary, it does not contain all information that you may find
useful. For further information you should read the indenture and the CZARS.
The indenture and the form of the CZARS are available as set forth under
"Where You Can Find More Information."
Definitions of certain terms are set forth under "Certain
Definitions" and throughout this description. Capitalized terms that are used
but not otherwise defined in this prospectus have the meanings assigned to
them in the indenture, and those definitions are incorporated in this
prospectus by reference. As used in this description, unless otherwise
indicated, the words "we," "us" and "our" refer to U.S. Bancorp (and its
successors) and not any of our subsidiaries.
General
The CZARS:
o are our unsecured senior obligations and rank equally with all
of our other unsecured senior indebtedness;
o are limited to $1,483,179,000 aggregate principal amount at
maturity; and
o will mature on August 6, 2021.
Except under circumstances described under "--Optional conversion
to semi-annual cash pay CZARS upon Tax Event" and "Contingent interest," we
will not pay cash interest on the CZARS. Instead, the CZARS will accrete to a
principal amount of $1,000 per CZARS upon maturity, representing a yield to
maturity of 1.50% per annum.
The CZARS are redeemable before the maturity date on or after August
6, 2003, as described below under "--Optional redemption," and do not have the
benefit of a sinking fund. Principal of the CZARS will be payable, and the
transfer of CZARS will be registrable, at the office of the trustee. U.S. Bank
Trust, National Association, one of our affiliates, will initially serve as
paying agent for the CZARS.
The CZARS were originally offered at a substantial discount from
their principal amount at maturity. Except as described below, we will not
make periodic cash payments of interest on the CZARS. Each CZARS of $1,000
principal amount at maturity was issued at an issue price of $741.65. For
United States federal income tax purposes, we will report the accrual of
original issue discount at the comparable yield of 7.03% under the contingent
payment debt regulations while the CZARS remain outstanding. The issue date
for the CZARS and the commencement date for the accrual of original issue
discount was August 6, 2001. See "Certain United States Federal Income Tax
Considerations--United States holders--Accrual of interest."
The CZARS were issued only in registered form without coupons in
denominations of $1,000 and any integral multiple of $1,000 above that amount.
No service charge will be made for any registration of transfer or exchange of
CZARS, but we may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection with the registration of
transfer or exchange of CZARS. The CZARS are represented by one or more global
securities registered in the name of a nominee of DTC. See "--Book entry,
delivery and form."
Ranking
The CZARS are our general unsecured obligations and rank senior in
right of payment to all our existing and future indebtedness that is, by its
terms, expressly subordinated in right of payment to the CZARS and equal in
right of payment with all our existing and future unsecured indebtedness that
is not so subordinated. Because we are a holding company, our rights and the
rights of our creditors, including the holders of the CZARS offered in this
11
prospectus, to participate in the assets of any subsidiary during its
liquidation or reorganization, will be subject to the prior claims of the
subsidiary's creditors, unless we are ourselves a creditor with recognized
claims against the subsidiary. Any capital loans that we make to any of our
banking subsidiaries would be subordinate in right of payment to deposits and
to other indebtedness of these banking subsidiaries. Claims from creditors
(other than us), on the subsidiaries, may include long-term and medium-term
debt and substantial obligations related to deposit liabilities, federal funds
purchased, securities sold under repurchase agreements, and other short-term
borrowings.
Conversion rights
Holders may convert CZARS, in multiples of $1,000 principal amount
at maturity, into our common stock at any time before the close of business on
August 6, 2021, if the average sale price, as defined below, of our common
stock for the 20 trading days immediately before the conversion date is equal
to or greater than a specified percentage, beginning at 120% in the year of
issuance and declining 1/2% each year thereafter until it reaches 110% at
maturity, of the accreted value, as defined below, as of the conversion date,
divided by the conversion rate.
Holders may also convert CZARS regardless of the sale price of our
common stock, in multiples of $1,000 principal amount at maturity, into our
common stock at any time after any of the following events:
o Change in Credit Ratings. The credit ratings assigned to the
CZARS by any two of Moody's, S&P or Fitch are reduced below
Baa1, BBB and BBB+, respectively, or the CZARS are no longer
rated by any two of these ratings services;
o Redemption of CZARS. We redeem the CZARS, in which case
holders may convert at any time before the close of business
on the business day before the redemption date; or
o Occurrence of Specified Corporate Transactions. We elect to:
(1) become a party to a consolidation, merger or binding
share exchange as a consequence of which our common
stock would be converted into cash or property (other
than securities), in which case a holder may surrender
CZARS for conversion at any time from and after the date
which is 15 days before the anticipated effective date
for the transaction until 15 days after the actual
effective date for the transaction;
(2) distribute to all holders of our common stock assets,
debt, securities or certain rights to purchase our
securities, which distribution has a per share value as
determined by our board of directors exceeding 15% of
the sale price of our common stock on the day preceding
the declaration date for that distribution; or
(3) distribute to all holders of our common stock certain
rights entitling them to purchase, for a period expiring
within 60 days after the date of the distribution, our
common stock at less than the sale price at the time of
the distribution.
In the case of clause (2) or (3), we must notify the holders of
CZARS at least 20 days before the ex-dividend date for the distribution. Once
we have given this notice, holders may surrender their CZARS for conversion at
any time until the earlier of the close of business on the business day before
the ex-dividend date or our announcement that the distribution will not take
place.
A CZARS for which a holder has delivered a purchase notice or a
Fundamental Change purchase notice, requiring us to purchase the CZARS may be
converted only if that notice is withdrawn in accordance with the indenture.
The initial conversion rate is 24.1430 shares of our common stock
per CZARS. The conversion rate may be adjusted upon the occurrence of certain
events described below. The conversion rate will not be adjusted for accrued
original issue discount or accrued and unpaid interest, if any.
In lieu of issuing fractional shares, we will pay an amount of cash
based on the sale price of our common stock on the trading day immediately
preceding the conversion date. On conversion of a CZARS, a holder will not
receive any cash payment representing accrued original issue discount or
accrued and unpaid interest, if any. Our delivery to the holder of the fixed
number of shares of our common stock into which the CZARS is convertible,
together with any cash payment for fractional shares, will be deemed:
12
o to satisfy our obligation to pay the principal amount at
maturity of the CZARS;
o to satisfy any obligation to pay the increase in accreted
value from the issue date of the CZARS through the conversion
date; and
o to satisfy any obligation to pay accrued and unpaid interest,
if any.
As a result, accreted value is deemed to be paid in full rather than
canceled, extinguished or forfeited.
A certificate for the number of full shares of our common stock into
which any CZARS is converted, together with any cash payment for fractional
shares, will be delivered through the conversion agent as soon as practicable
following the conversion date.
The conversion rate will be adjusted for:
o dividends or distributions on our common stock payable in our
common stock or our other capital stock;
o subdivisions, combinations or certain reclassifications of our
common stock;
o distributions to all holders of our common stock of certain
rights to purchase our common stock for a period expiring
within 60 days at less than the sale price at the time; and
o distributions to all holders of our common stock of our
assets, debt securities or certain rights to purchase our
securities, if the distribution has a per share value
exceeding 15% of the market price, as defined below, on the
day preceding the declaration of the distribution (aggregating
distributions on an annual basis).
No adjustment in the conversion rate will be required unless the
adjustment would require a change of at least 1% of the conversion rate then
in effect, except that any adjustment that would otherwise be required to be
made will be carried forward and taken into account in any subsequent
adjustment. Except as stated above, the conversion rate will not be adjusted
for the issuance of common stock or any securities convertible into or
exchangeable for common stock or carrying the right to purchase common stock
or any securities convertible into or exchangeable for common stock.
No adjustment need be made if holders may participate in the
transaction that would otherwise give rise to such an adjustment. In cases
where the fair market value of assets, debt securities or certain rights,
warrants or options to purchase our securities distributed to shareholders (a)
equals or exceeds the sale price of our common stock, or (b) the sale price of
our common stock exceeds the fair market value of those assets, debt
securities or rights, warrants or options so distributed by less than $1.00,
rather than being entitled to an adjustment in the conversion rate, the holder
will be entitled to receive upon conversion, in addition to the shares of our
common stock, the kind and amount of assets, debt securities or rights,
warrants or options comprising the distribution that the holder would have
received if the holder had converted its CZARS immediately before the record
date for determining the shareholders entitled to receive the distribution.
The indenture will permit us to increase the conversion rate from time to
time.
If we are party to a consolidation, merger or binding share exchange
or a transfer of all or substantially all of our assets, the right to convert
a CZARS into our common stock may be changed into a right to convert it into
the kind and amount of securities, cash or other assets of ours or of another
person's which the holder would have received if the holder had converted the
holder's CZARS immediately before the transaction.
Holders of the CZARS may, in certain circumstances, be deemed to
have received a distribution treated as a dividend for United States federal
income tax purposes as the result of:
o a taxable distribution to holders of our common stock which
results in an adjustment of the conversion rate; or
o an increase in the conversion rate at our discretion.
13
If we exercise our option to have cash interest accrue on a CZARS
following a Tax Event, as defined below, the holder will be entitled on
conversion to receive the same number of shares of our common stock or other
property that the holder would have received if we had not exercised this
option.
If we exercise our option to have cash interest accrue on a CZARS
following a Tax Event or are required to pay contingent interest, CZARS
surrendered for conversion by a holder during the period from the close of
business on any regular record date to the opening of business of the next
interest payment date, except for CZARS to be redeemed on a date within this
period or on the next interest payment date, must be accompanied by payment of
an amount equal to the contingent interest or interest that the holder is to
receive on the CZARS. See "--Contingent interest" and "--Optional conversion
to semi-annual cash pay CZARS upon Tax Event."
Contingent interest
Subject to the accrual and record date provisions described below,
we will pay contingent interest to the holders of CZARS during any six-month
period from August 6 to February 5 and from February 6 to August 5, commencing
with the six-month period beginning August 6, 2003, if the average price of
the CZARS for the applicable five trading day period, which we refer to as the
average CZARS price, equals 120% or more of the accreted value of the CZARS on
the day immediately preceding the relevant six-month period. See "--Optional
redemption" for a listing of the accreted value at specified dates. We will
pay contingent interest only in cash. The "applicable five trading day period"
means the five trading days ending on the second trading day immediately
preceding the relevant six-month period, unless we declare a dividend for
which the record date falls before the first day of a six-month period but the
payment date falls within that six-month period, in which case the "applicable
five trading day period" means the five trading days ending on the second
trading day immediately preceding the record date.
The amount of contingent interest payable per CZARS in respect of
any six-month period will equal the greater of (1) cash dividends paid by us
per share on our common stock during that six-month period multiplied by the
number of shares of our common stock issuable upon conversion of a CZARS at
the then applicable conversion rate and (2) .17575% of the accreted value.
Contingent interest, if any, will accrue and be payable to holders
of CZARS as of the record date for the related common stock dividend or, if no
cash dividend is paid by us during a quarter within the relevant six-month
period, to holders of CZARS as of the fifteenth day preceding the last day of
the relevant six-month period. The payments will be paid on the payment date
of the related common stock dividend or, if no cash dividend is paid by us
during a quarter within the relevant six-month period, on the last day of the
relevant six-month period. For United States federal income tax purposes,
original issue discount will continue to accrue at the comparable yield, which
we will report as 7.03% under the contingent debt payment regulations, subject
to adjustment for actual payments of contingent interest. See "Certain United
States Federal Income Tax Considerations--United States holders--Accrual of
interest."
For financial accounting purposes, our obligation to pay contingent
interest on the CZARS constitutes an embedded derivative, the initial value of
which is not material to our consolidated financial position. Any material
changes in its value will be reflected in our future income statements, in
accordance with Statement of Financial Accounting Standards No. 133.
"Accounting for Derivative Instruments and Hedging Activities." We do not
believe that any future changes in value will have a significant effect on our
future reported results of operations.
Cash dividends are all cash dividends on our common stock (whether
regular, periodic, extraordinary, special, nonrecurring or otherwise) as
declared by our board of directors.
The "CZARS price" on any date of determination means the average of
the secondary market bid quotations per CZARS obtained by the bid solicitation
agent for $10 million principal amount at maturity of CZARS at approximately
4:00 p.m., New York City time, on the determination date from three
unaffiliated securities dealers we select, provided that if:
o at least three such bids are not obtained by the bid
solicitation agent, or
o in our reasonable judgment, the bid quotations are not
indicative of the secondary market value of the CZARS,
then the CZARS price will equal (a) the then applicable conversion rate of the
CZARS multiplied by (b) the average sale price of our common stock on the five
trading days ending on the determination date.
14
The bid solicitation agent will initially be the trustee. We may
change the bid solicitation agent, but the bid solicitation agent will not be
our affiliate. The bid solicitation agent will solicit bids from securities
dealers that are believed by us to be willing to bid for the CZARS.
If we determine that holders will be entitled to receive contingent
interest which may become payable during a relevant six-month period, on or
before the start of that six-month period, we will issue a press release and
publish this information on our corporate web site.
Optional redemption
No sinking fund is provided for the CZARS. Beginning on August 6,
2003, at our option we may redeem the CZARS for cash at any time as a whole,
or from time to time in part, at a redemption price equal to the accreted
value of the CZARS, plus accrued and unpaid interest, if any. If converted to
semi-annual cash pay CZARS, following the occurrence of a Tax Event, the CZARS
will be redeemable at the restated principal amount, as defined below, plus
accrued and unpaid interest from the date of the conversion through the
redemption date. However, in no event may the CZARS be redeemed before August
6, 2003. See "--Optional conversion to semi-annual cash pay CZARS upon Tax
Event." We will give holders not less than 30-days' nor more than 60-days'
notice of redemption.
The table below shows what the accreted value of a CZARS of $1,000
principal amount at maturity would be on August 6, 2003, and at specified
dates thereafter before maturity and at maturity on August 6, 2021. The
accreted value, in dollars, of a CZARS redeemed between the dates set forth
below would include an additional amount reflecting the increase in accreted
value since the next preceding date in the table.
Increase in Accreted Redemption
Redemption Date Issue Price(1) Value at 1.50%(2) Price (1+2)
August 6, 2003 $741.65 $ 22.50 $ 764.15
August 6, 2004 $741.65 $ 34.01 $ 775.66
August 6, 2005 $741.65 $ 45.68 $ 787.33
August 6, 2006 $741.65 $ 57.54 $ 799.19
August 6, 2007 $741.65 $ 69.57 $ 811.22
August 6, 2008 $741.65 $ 81.79 $ 823.44
August 6, 2009 $741.65 $ 94.18 $ 835.83
August 6, 2010 $741.65 $106.77 $ 848.42
August 6, 2011 $741.65 $119.54 $ 861.19
August 6, 2012 $741.65 $132.51 $ 874.16
August 6, 2013 $741.65 $145.67 $ 887.32
August 6, 2014 $741.65 $159.03 $ 900.68
August 6, 2015 $741.65 $172.59 $ 914.24
August 6, 2016 $741.65 $186.36 $ 928.01
August 6, 2017 $741.65 $200.33 $ 941.98
August 6, 2018 $741.65 $214.51 $ 956.16
August 6, 2019 $741.65 $228.91 $ 970.56
August 6, 2020 $741.65 $243.52 $ 985.17
August 6, 2021 $741.65 $258.35 $ 1000.00
If less than all of the outstanding CZARS are to be redeemed, the
trustee will select the CZARS to be redeemed in principal amounts at maturity
of $1,000 or integral multiples of $1,000. In this case the trustee may select
the CZARS by lot, pro rata or by any other method the trustee considers fair
and appropriate. If a portion of a holder's CZARS is selected for partial
redemption and the holder converts a portion of the CZARS, the converted
portion will be deemed to be the portion selected for redemption.
Purchase of CZARS at the option of the holder
On the purchase dates indicated below, we will, at the option of the
holder, be required to purchase any outstanding CZARS for which a written
purchase notice has been properly delivered by the holder to the trustee and
not withdrawn, subject to specified additional conditions. Holders may submit
their CZARS for purchase to the paying agent at any time from the opening of
business on the date that is 30 business days before the purchase date until
the close of business on that purchase date.
15
The purchase price of a CZARS (in each case, plus accrued and unpaid
interest, if any) will be:
o $752.82 per CZARS on August 6, 2002;
o $764.15 per CZARS on August 6, 2003;
o $775.66 per CZARS on August 6, 2004;
o $799.19 per CZARS on August 6, 2006;
o $823.44 per CZARS on August 6, 2008;
o $861.19 per CZARS on August 6, 2011; and
o $928.01 per CZARS on August 6, 2016.
The foregoing dollar amounts equal the accreted value on the
respective purchase dates.
If before a purchase date the CZARS have been converted to cash pay
CZARS, the purchase price will be equal to the restated principal amount plus
accrued and unpaid interest from the date of conversion to the purchase date.
See "--Optional conversion to semi-annual cash pay CZARS upon Tax Event."
We will be required to give notice on a date not less than 30
business days before each purchase date by giving notice to all holders and
beneficial owners as required by applicable law, stating among other things
the procedures that holders must follow to require us to purchase their CZARS.
The purchase notice given by each holder electing to require us to
purchase CZARS must state:
o if certificated, the certificate numbers of the holder's CZARS
to be delivered for purchase;
o the portion of the principal amount at maturity of CZARS to be
purchased, which must be $1,000 or an integral multiple of
$1,000; and
o that the CZARS are to be purchased by us under to the
applicable provisions of the CZARS and the indenture.
Any purchase notice may be withdrawn by the holder by a written
notice of withdrawal delivered to the paying agent before the close of
business on the business day before the purchase date. The notice of
withdrawal must state:
o the principal amount at maturity being withdrawn;
o if certificated, the certificate numbers of the CZARS being
withdrawn; and
o the principal amount at maturity of the CZARS that remain
subject to the purchase notice, if any.
In connection with any purchase offer pursuant to these provisions,
to the extent applicable we will:
o comply with the provisions of Rule l3e-4, Rule 14e-l and any
other tender offer rules under the Exchange Act which may then
be applicable; and
o file Schedule TO or any other required schedule under the
Exchange Act.
Payment of the purchase price for a CZARS for which a purchase
notice has been delivered and not validly withdrawn is conditioned upon
delivery of the CZARS, together with necessary endorsements, to the paying
agent at any time after delivery of the purchase notice. Payment of the
purchase price for the CZARS will be made promptly following the later of the
purchase date or the time of delivery of the CZARS.
16
If the paying agent holds money or securities sufficient to pay the
purchase price of a CZARS on the business day following the purchase date in
accordance with the terms of the indenture, then, immediately after the
purchase date, the CZARS will cease to be outstanding and will cease to
accrete original issue discount, whether or not the CZARS is delivered to the
paying agent. Thereafter, all other rights of the holder will terminate, other
than the right to receive the purchase price upon delivery of the CZARS.
Our ability to purchase CZARS may be limited by the terms of our
then existing indebtedness or financing agreements.
No CZARS may be purchased at the option of holders if there has
occurred and is continuing an event of default, other than an event of default
that is cured by the payment of the purchase price of all such CZARS.
Fundamental Change permits holders to require us to purchase CZARS
If a Fundamental Change, as defined below, occurs at any time before
August 6, 2003, each holder will have the right, at the holder's option, to
require us to purchase any or all of the holder's CZARS. The CZARS may be
purchased in multiples of $1,000 principal amount at maturity. We will
purchase the CZARS at a price equal to the accreted value of the CZARS on the
purchase date plus accrued and unpaid interest, if any. See the table under
"--Optional Redemption." If, before the purchase date, we elect to convert the
CZARS to cash pay CZARS, the purchase price will be equal to the restated
principal amount plus accrued and unpaid interest from the date of conversion
to the purchase date. See "--Optional conversion to semi-annual cash pay CZARS
upon Tax Event." If a Fundamental Change occurs on or after August 6, 2003, no
holder will have a right to require us to purchase any CZARS, except as
described above under "--Purchase of CZARS at the option of the holder."
A "Fundamental Change" will be deemed to have occurred at that time
after the original issuance of the CZARS as any of the following occurs:
(1) a "person" or "group" within the meaning of Section 13(d) of the
Exchange Act, other than us, our subsidiaries or our or their
employee benefit plans, files a Schedule TO (or any schedule,
form or report under the Exchange Act) disclosing that that
person or group has become the direct or indirect "beneficial
owner" within the meaning of Rule l3d-3 under the Exchange Act,
of our common equity representing more than 50% of the voting
power of our common equity;
(2) consummation of any share exchange, consolidation or merger of
us as a consequence of which our common stock will be converted
into cash, securities or other property or any sale, lease or
other transfer, in one transaction or a series of transactions,
of all or substantially all of our consolidated assets
(considered together with our subsidiaries) to any person, other
than one of our subsidiaries; provided, however, that a
transaction where the holders of all classes of our common
equity immediately before the transaction own, directly or
indirectly, more than 50% of all classes of common equity of the
continuing or surviving corporation or transferee immediately
after the event will not be a Fundamental Change; or
(3) continuing directors, as defined below, cease to constitute at
least a majority of our board of directors.
A Fundamental Change will not be deemed to have occurred, however,
if either:
(I) the sale price of our common stock for any five trading
days within the 10 consecutive trading days ending immediately before
the later of the Fundamental Change or the announcement of the
Fundamental Change, will equal or exceed 105% of the accreted value
as of that date, divided by the conversion rate, or
(II) at least 50% of the consideration in the transaction or
transactions constituting the Fundamental Change consists of shares
of common stock traded on a national securities exchange or quoted on
the Nasdaq Stock Market, or which will be so traded or quoted when
issued or exchanged in connection with the Fundamental Change, and
as a result of that transaction or transactions the CZARS become
convertible solely into such publicly traded shares, excluding cash
payments for fractional shares.
On or before the 20th day after the occurrence of a Fundamental
Change, we will provide to all holders of the CZARS and the trustee a notice
of the occurrence of the Fundamental Change and of the resulting purchase
right. This notice will state, among other things, the procedures that holders
must follow to require us to purchase their CZARS.
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To exercise the purchase right, holders of CZARS must deliver, on or
before the 35th day after the date of our notice of a Fundamental Change,
subject to extension to apply with applicable law, the CZARS to be purchased,
duly endorsed for transfer, together with a written purchase notice and the
form entitled "Option to Elect Purchase Upon a Fundamental Change" on the
reverse side of the CZARS duly completed, to the paying agent. The purchase
notice given by each holder electing to require us to purchase CZARS must
state:
o if certificated, the certificate numbers of the holder's
CZARS to be delivered for purchase;
o the portion of the principal amount at maturity of CZARS to
be purchased, which must be $1,000 or an integral multiple of
$1,000; and
o that the CZARS are to be purchased by us under the applicable
provisions of the CZARS and the indenture.
Any purchase notice may be withdrawn by the holder by a written
notice of withdrawal delivered to the paying agent before the close of
business on the business day before the purchase date. The notice of
withdrawal must state:
o the principal amount at maturity being withdrawn;
o if certificated, the certificate numbers of the CZARS being
withdrawn; and
o the principal amount at maturity of the CZARS that remain
subject to the purchase notice, if any.
We will be required to purchase the CZARS no later than 35 business
days after the occurrence of the relevant Fundamental Change subject to
extension to comply with applicable law.
In connection with any purchase offer pursuant to these provisions,
to the extent applicable we will:
o comply with the provisions of Rule 13e-4, Rule 14e-l and any
other tender offer rules under the Exchange Act; and
o file Schedule TO or any other required schedule under the
Exchange Act.
The purchase rights of the holders could discourage a potential
acquirer of us. The Fundamental Change purchase feature, however, is not the
result of management's knowledge of any specific effort to obtain control of
us by any means or part of a plan by management to adopt a series of
anti-takeover provisions.
The term "Fundamental Change" is limited to specified transactions
and may not include other events that might adversely affect our financial
condition. In addition, the requirement that we offer to purchase the CZARS
upon a Fundamental Change may not protect holders in the event of a highly
leveraged transaction, reorganization, merger or similar transaction involving
us.
No CZARS may be purchased at the option of holders upon a
Fundamental Change if there has occurred and is continuing an event of default
other than an event of default that is cured by the payment of the purchase
price of all such CZARS.
The indenture requires the payment of money for CZARS or portions of
CZARS validly tendered to and accepted for payment by us pursuant to a
Fundamental Change offer. If a Fundamental Change has occurred under the
indenture, a change of control might also occur under any other indenture or
other agreement governing our then-existing debt or might result in the
acceleration of the maturity of any of our then existing indebtedness. If a
Fundamental Change were to occur or we were required to purchase outstanding
CZARS as described under "--Purchase of CZARS at the option of the holder," we
cannot assure you that we would have sufficient funds to pay the purchase
price for all CZARS and amounts due under other indebtedness that we may be
required to purchase or repay. Failure by us to purchase the CZARS when
required upon a Fundamental Change will result in an event of default with
respect to the CZARS.
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Optional conversion to semi-annual cash pay CZARS upon Tax Event
From and after the date of the occurrence of a Tax Event, we will
have the option to elect to have cash interest in lieu of future original
issue discount accrue on all, and not less than all of, the CZARS at the rate
of 1.50% per year. If we exercise this option to pay cash interest, the
principal amount of each CZARS will be restated (the "restated principal
amount") and will equal its accreted value on the date of the Tax Event or the
date on which we exercise the option described above, whichever is later (the
"option exercise date").
Cash interest will accrue from the option exercise date and will be
payable in cash semi-annually on the interest payment dates of August 6 and
February 6 of each year to holders of record at the close of business on July
21 or January 21 immediately preceding the interest payment date. Interest
will be computed on the basis of a 360-day year comprised of twelve 30-day
months. Interest will initially accrue from the option exercise date and
thereafter from the last date to which interest has been paid. If we exercise
this option to pay cash interest, the redemption price, purchase price and
Fundamental Change purchase price on the CZARS will he adjusted. However,
there will be no change in the holder's conversion rights.
A "Tax Event" means that we have received an opinion from
independent tax counsel experienced in these matters to the effect that, on or
after the date of the initial placement of the CZARS, as a result of:
(1) any amendment to, or change in (including any announced proposed
change in), the laws, rules or regulations thereunder of the
United States or any political subdivision or taxing authority
thereof or therein, or
(2) any official administrative pronouncement, action or judicial
decision interpreting or applying these laws or regulations,
in each case which amendment or change is enacted, promulgated,
issued or announced or which proposed change, pronouncement, action
or decision is issued or announced, on or after the date of this
prospectus, there is more than an insubstantial risk that interest
(including original issue discount or contingent interest, if any)
payable on the CZARS either:
o would not be deductible on a current accrual basis, or
o would not be deductible under any other method,
in either case in whole or in part, by us (by reason of deferral,
disallowance, or otherwise) for United States federal income tax
purposes.
The modification of the terms of the CZARS by us upon a Tax Event,
as described above, may alter the timing of income recognition by holders of
the CZARS with respect to the semi-annual payments of interest due on the
CZARS after the option exercise date.
Events of default
Each of the following constitutes an event of default under the
indenture:
o default in payment of the principal amount at maturity (or if
the CZARS have been converted to cash pay CZARS following a
Tax Event, the restated principal amount), redemption price,
purchase price or Fundamental Change purchase price with
respect to any CZARS when this amount becomes due and payable;
o if additional amounts are owing due to a breach of the
registration rights agreement under which we agreed to
register the CZARS, contingent interest is payable or the
CZARS have been converted to cash pay CZARS following a Tax
Event, the failure to pay these additional amounts or interest
due within 30 days of the due date;
o our failure to comply with any of our other agreements in the
CZARS or the indenture upon receipt by us of notice of the
default by the trustee or by holders of not less than 25% in
aggregate principal amount at maturity of the CZARS then
outstanding and our failure to cure (or obtain a waiver of)
the default within 60 days after our receipt of that notice;
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o default in the payment of indebtedness for money borrowed
under any indenture or instrument under which we have or a
principal subsidiary bank has outstanding indebtedness in an
amount in excess of $5,000,000 which has become due and has
not been paid, or whose maturity has been accelerated and the
default has not been cured or acceleration annulled within 60
days after written notice; and
o certain events of bankruptcy or insolvency affecting us.
If any event of default shall have happened and be continuing,
either the trustee or the holders of not less than 25% in aggregate principal
amount at maturity of the CZARS then outstanding may declare the issue price
of the CZARS plus the original issue discount on the CZARS accrued through the
date of that declaration to be immediately due and payable. At any time after
a declaration of acceleration has been made on the CZARS, but before the
trustee has obtained a judgment for payment, the holders of a majority in
aggregate principal amount at maturity of the outstanding CZARS may, under
some circumstances, rescind and annul the declaration of acceleration. In the
case of certain events of bankruptcy or insolvency, the issue price of the
CZARS plus the original issue discount accrued on the CZARS through the
occurrence of the event of bankruptcy or insolvency will automatically become
and be immediately due and payable.
Subject to the provisions of the indenture relating to the duties of
the trustee in case an event of default shall occur and be continuing, the
trustee is under no obligation to exercise any of its rights or powers under
the indenture at the request or direction of any of the holders, unless the
holders have offered to the trustee reasonable indemnity. Subject to the
provisions for the indemnification of the trustee, the holders of a majority
in aggregate principal amount at maturity of the outstanding CZARS have the
right to direct the time, method and place of conducting any proceeding for
any remedy available to the trustee or exercising any trust or power conferred
on the trustee with respect to the CZARS.
We are required to furnish to the trustee annually a statement by
certain of our officers as to whether or not we, to their knowledge, are in
default in the performance or observance of any of the terms, provisions and
conditions of the indenture and, if so, specifying all of the known defaults.
Modification and waiver
Modifications and amendments of the indenture may be made by us and
the trustee with the consent of the holders of at least a majority in
aggregate principal amount at maturity of the outstanding CZARS affected by
the modification or amendment. In addition, we and the trustee may, without
the consent of holders of the CZARS, modify the indenture to cure errors,
resolve inconsistent provisions or make other provisions provided that these
modifications do not adversely affect the interests of holders of the CZARS in
any material respect.
No modification or amendment may, without the consent of the holder
of each outstanding CZARS affected thereby,
o make any change to the percentage of principal amount at
maturity of CZARS the holders of which must consent to an
amendment;
o reduce the principal amount at maturity, restated principal
amount or issue price, or extend the stated maturity, of any
CZARS;
o reduce the redemption price, purchase price or Fundamental
Change purchase price of any CZARS;
o make any change that adversely affects the right to convert
any CZARS;
o except as otherwise provided in this prospectus and in the
indenture, alter the manner or rate of accrual of original
issue discount or interest on any CZARS, reduce the rate of
interest upon the occurrence of a Tax Event, or extend the
time for payment of original issue discount or interest, if
any, on any CZARS;
o make any CZARS payable in money or securities other than that
stated in the CZARS;
o make any change that adversely affects that holder's right to
require us to purchase a CZARS; or
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o impair the right to institute suit for the enforcement of any
payment with respect to, or conversion of, the CZARS.
The holders of at least a majority in principal amount at maturity
of the outstanding CZARS may waive compliance by us with certain restrictive
provisions of the indenture. The holders of a majority in principal amount at
maturity of the outstanding CZARS may waive any past default under the
indenture, except a default in the payment of principal or interest and
certain covenants and provisions of the indenture which cannot be amended
without the consent of the holder of each outstanding CZARS.
Mergers and sales of assets
The indenture provides that we may not consolidate with or merge
into any other person or convey, transfer or lease its properties and assets
substantially as an entirety to another person, unless among other items, (i)
the resulting, surviving or transferee person (if other than us) is organized
and existing under the laws of the United States, any state thereof or the
District of Columbia and that person assumes all our obligations under the
CZARS and the indenture, and (ii) we or the successor person shall not
immediately thereafter be in default under the indenture. Upon the assumption
of our obligations by such a person in these circumstances, subject to certain
exceptions, we will be discharged from all obligations under the CZARS and the
indenture. Although the transactions described above are permitted under the
indenture, certain of these transactions, if they occur on or before August 6,
2003, could constitute a Fundamental Change permitting each holder to require
us to purchase the CZARS of that holder as described above.
Discharge of the indenture
We may satisfy and discharge our obligations under the indenture by
delivering to the trustee for cancellation all outstanding CZARS or by
depositing with the trustee, the paying agent or the conversion agent, if
applicable, after the CZARS have become due and payable, whether at stated
maturity, or any redemption date, or any purchase date, or a Fundamental
Change purchase date, or upon conversion or otherwise, cash or shares of
common stock (as applicable under the terms of the indenture) sufficient to
pay all of the outstanding CZARS and paying all other sums payable under the
indenture by us.
Limitation of claims in bankruptcy
If a bankruptcy proceeding is commenced in respect of us, the claim
of the holder of a CZARS is, under Title 11 of the United States Code, limited
to the issue price of the CZARS plus that portion of the original issue
discount that has accreted from the date of issue to the commencement of the
proceeding.
Regarding the trustee
The indenture provides that, except during the continuance of an
event of default, the trustee will perform only those duties as are
specifically set forth in the indenture. During the existence of an event of
default, the trustee will exercise the rights and powers vested in it under
the indenture and use the same degree of care and skill in its exercise as a
prudent person would exercise under the circumstances in the conduct of that
person's own affairs.
The indenture and provisions of the Trust Indenture Act that will be
incorporated by reference in the indenture upon the effectiveness of the shelf
registration statement of which this prospectus is a part contain limitations
on the rights of the trustee, should it become one of our creditors, to obtain
payment of claims in certain cases or to realize on certain property received
by it in respect of such a claim as security or otherwise. The trustee is
permitted to engage in other transactions with us or any of our affiliates;
provided, however, that if it acquires any conflicting interest (as defined in
the indenture or in the Trust Indenture Act), it must eliminate that conflict
or resign.
The trustee under the indenture is also the trustee under other
indentures relating to other indebtedness we have outstanding. The trustee and
its affiliates have performed banking, investment banking, custodial and
advisory services for us from time to time for which it and they have received
customary fees and expenses.
Calculations in respect of CZARS
We or our agents will be responsible for making all calculations
called for under the CZARS. These calculations include, but are not limited
to, determination of the market prices of the CZARS and of the common
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stock and amounts of interest and contingent interest, if any, on the CZARS.
We or our agents will make all these calculations in good faith and, absent
manifest error, our and their calculations will be final and binding on
holders of CZARS. We or our agents will provide a schedule of these
calculations to the trustee, and the trustee is entitled to conclusively rely
upon the accuracy of these calculations without independent verification.
Certain definitions
Set forth below is a summary of some of the defined terms used in
the indenture. We refer you to the indenture for the full definition of all
terms used in the indenture.
"accreted value" means, at any date of determination, (1) before
such time as the CZARS are converted to cash pay CZARS, the sum of (x) the
initial offering price of each CZARS and (y) the portion of the excess of the
principal amount of each CZARS over the initial offering price which shall
have been amortized by us in accordance with GAAP through that date, that
amount to be so amortized on a daily basis and compounded semi-annually on
each August 6 and February 6 at the rate of 1.50% per annum from the issue
date of the CZARS through the date of determination computed on the basis of a
360-day year of twelve 30-day months and (2) at or after the time that the
CZARS are converted to cash pay CZARS, the restated principal amount.
"common stock" means our common stock, par value $.0l per share, as
it exists on the date of the indenture and any shares of any class or classes
of our capital stock resulting from any reclassification or reclassifications
of our capital stock and which have no preference in respect of dividends or
of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding-up of us and which are not subject to redemption by us;
provided, however, that if at any time there is more than one resulting class
of our capital stock, the shares of each class then so issuable on conversion
of CZARS will be substantially in the proportion which the total number of
shares of that class resulting from all of the reclassifications bears to the
total number of shares of all classes of capital stock resulting from all of
the reclassifications.
"common equity" of any person means capital stock of that person
that is generally entitled to (1) vote in the election of directors of that
person or (2) if that person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or
others that will control the management or policies of that person.
"continuing director" means a director who was a member of our board
of directors on the date two years before the relevant date.
The "market price" as of any date means the average of the sale
prices of our common stock for the 20 trading-day period ending on the third
business day (if the third business day before the applicable date is a
trading day or, if not, then on the last trading day) before that date,
appropriately adjusted to take into account the occurrence, during the period
commencing on the first trading day during the 20 trading day period and
ending on that date, of certain events with respect to our common stock that
would result in an adjustment of the conversion rate.
The "sale price" of our common stock on any date means the closing
sale price per share (or if no closing sale price is reported, the average of
the bid and ask prices or, if more than one in either case, the average of the
average bid and the average ask prices) on that date as reported in composite
transactions for the principal United States securities exchange on which our
common stock is traded or, if our common stock is not listed on a United
States national or regional securities exchange, as reported on the Nasdaq
Stock Market.
Governing law
The indenture and the CZARS are governed by, and construed in
accordance with, the law of the State of New York.
Book entry, delivery and form
The CZARS are evidenced by one or more fully registered global
CZARS. The global CZARS were deposited on or about the issue date of the CZARS
with, or on behalf of, The Depository Trust Company, or DTC, and registered in
the name of Cede & Co., as nominee of DTC. Upon resale of the CZARS in
accordance with the registration statement of which this prospectus forms a
part, beneficial interests in the global CZARS will be transferred from one or
more restricted global securities to one or more unrestricted global
securities. Owners of beneficial interests in the CZARS represented by the
global securities will hold their interests pursuant to the
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procedures and practices of DTC. As a result, beneficial interests in any such
securities will be shown on, and transfers will be effected only through,
records maintained by DTC and its direct and indirect participants and any such
interest may not be exchanged for certificated securities, except in limited
circumstances. Owners of beneficial interests must exercise any rights in
respect of their interests, including any right to convert or require purchase
of their interests in the CZARS, in accordance with the procedures and
practices of DTC.
So long as Cede & Co., as nominee of DTC, is the registered owner of
any CZARS, Cede & Co. will be considered the sole owner or holder of the
global CZARS outstanding under the indenture. Except as provided below, owners
of CZARS will not be entitled to have CZARS registered in their names, will
not receive or be entitled to receive physical delivery of CZARS in definitive
form, and will not be considered the holders of the CZARS under the indenture
for any purpose, including with respect to the giving of any directions,
instructions or approvals to the trustee thereunder. As a result, the ability
of a person having a beneficial interest in CZARS represented by the global
CZARS to pledge that interest to persons or entities that do not participate
in DTC's system or to otherwise take actions in respect of that interest may
be affected by the lack of a physical certificate evidencing that interest.
You should be aware that the laws of some states require that certain persons
take physical delivery in definitive form of securities that they own.
Consequently, the ability to transfer CZARS may be limited.
DTC is a limited-purpose trust company which was created to hold
securities for its participating organizations, which we refer to as
participants, and to facilitate the clearance and settlement of transactions
in those securities between participants through electronic book-entry changes
in accounts of the participants. The participants include securities brokers
and dealers, banks and trust companies, clearing corporations and certain
other organizations. Access to DTC's system is also available to other
entities such as banks, brokers, dealers and trust companies, which we refer
to as indirect participants, that clear through or maintain a custodial
relationship with a participant, either directly or indirectly. Persons who
are not participants may beneficially own securities held by or on behalf of
DTC only through the participants or indirect participants.
Neither we, the trustee, the paying agent nor the CZARS registrar
will have any responsibility or liability for any aspect of the records
relating to or payments made on account of CZARS by DTC, or for maintaining,
supervising or reviewing any records of DTC relating to the CZARS.
Payments in respect of the principal, premium, if any, and interest
on any CZARS registered in the name of Cede & Co. on the applicable record
date will be payable by the trustee to or at the direction of Cede & Co. in
its capacity as the registered holder under the indenture. Under the terms of
the indenture, we and the trustee may treat the persons in whose names the
CZARS, including the global CZARS, are registered as the owners of those CZARS
for the purpose of receiving those payments and for any and all other purposes
whatsoever. Consequently, neither we nor the trustee has or will have any
responsibility or liability for the payment of amounts due to beneficial
owners of CZARS (including principal, premium, if any, and interest).
We believe, however, that it is currently the policy of DTC to
immediately credit the accounts of the relevant participants with the payments
described above, in amounts proportionate to their respective holdings in
principal amount at maturity of beneficial interests in the relevant security
as shown on the records of DTC. Payments by the participants and the indirect
participants to the beneficial owners of CZARS will be governed by standing
instructions and customary practice and will be the responsibility of the
participants or the indirect participants.
As long as the CZARS are represented by one or more global CZARS,
DTC's nominee will be the holder of the CZARS and therefore will be the only
entity that can exercise a right to repayment or repurchase of the CZARS. See
"--Purchase of CZARS at the option of the holder" and "--Fundamental Change
permits holders to require us to purchase CZARS." Notice by participants or
indirect participants or by owners of beneficial interests in a global CZARS
held through participants or indirect participants of the exercise of the
option to require purchase or conversion of beneficial interests in CZARS
represented by a global CZARS must be transmitted to DTC in accordance with
its procedures on a form required by DTC and provided to participants. To
ensure that DTC's nominee will timely exercise a right to purchase or
conversion with respect to a particular CZARS, the beneficial owner of that
CZARS must instruct the broker or the participant or indirect participant
through which it holds an interest in that CZARS to notify DTC of its desire
to exercise a right to purchase or conversion. Different firms have cut-off
times for accepting instructions from their customers and, accordingly, each
beneficial owner should consult the broker or other participant or indirect
participant through which it holds an interest in a CZARS to ascertain the
cut-off time by which such an instruction must be given in order for timely
notice to be delivered to DTC. We will not be liable for any delay in delivery
of notices of the exercise of the option to elect purchase or conversion.
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If DTC is at any time unwilling to continue as depositary and a
successor depositary is not appointed by us within 90 days, we will issue
definitive CZARS in exchange for the global CZARS.
Same-day settlement and payment
The indenture requires that payments in respect of the CZARS
(including principal, premium, if any, and interest) be made by transfer of
same-day funds to the accounts specified by Cede & Co.
Transfer and exchange
A holder may transfer or exchange the CZARS in accordance with the
procedures set forth in the indenture. The registrar may require a holder,
among other things, to furnish appropriate endorsements and transfer
documents, and to pay any taxes and fees required by law or permitted by the
indenture. The registrar is not required to transfer or exchange any CZARS
selected for redemption. Also, the registrar is not required to transfer or
exchange any CZARS for a period of 15 days before a selection of the CZARS to
be redeemed.
The registered holder of a CZARS will be treated as the owner of it
for all purposes.
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DESCRIPTION OF COMMON STOCK
General
We are authorized to issue up to 4 billion shares of common stock,
par value $.01 per share. As of September 30, 2001, there were 1,969,001,279
shares of common stock issued and outstanding. Our common stock is listed on
the New York Stock Exchange under the symbol "USB."
Voting and other rights
Each share of common stock is entitled to one vote per share, and,
in general, a majority of votes cast with respect to a matter will be
sufficient to authorize action upon routine matters. Directors are elected by
a majority of the votes cast, and stockholders do not have the right to
cumulate their votes in the election of directors. For that reason, holders of
a majority of the shares of common stock entitled to vote in any election of
directors may elect all of the directors standing for election. In general,
however:
o amendments to the certificate of incorporation will be
approved if the votes cast within a voting group favoring the
action exceed the votes cast within the voting group opposing
the action; and
o any merger, dissolution, or the sale of all or substantially
all of our assets, must be approved by the affirmative vote of
the holders of a majority of the voting power of the
outstanding voting shares and the affirmative vote of the
holders of a majority of the outstanding shares of each class
entitled to vote on the matter as a class.
No preemptive or conversion rights
Our common stock will not entitle its holders to any preemptive
rights, redemption privileges, sinking fund privileges or conversion rights.
Assets upon dissolution
In the event of liquidation, holders of common stock would be
entitled to receive proportionately any assets legally available for
distribution to our shareholders with respect to shares held by them, subject
to any prior or equal rights of any of our preferred stock when outstanding.
Distributions
Holders of common stock will be entitled to receive the dividends or
distributions that our board of directors may declare out of funds legally
available for these payments. The payment of distributions by us is subject to
the restrictions of Delaware law applicable to the declaration of
distributions by a corporation. Under Delaware law a corporation may not pay a
dividend out of net profits if the capital stock of the corporation is less
than the stated amount of capital represented by the issued and outstanding
stock of all classes having a preference upon the distribution of the
corporation's assets. In addition, the payment of distributions to
shareholders is subject to any prior or equal rights of outstanding preferred
stock.
As a bank holding company, our ability to pay distributions will be
affected by the ability of our banking subsidiaries to pay dividends. The
ability of these banking subsidiaries, as well as us, to pay dividends in the
future currently is, and could be further, influenced by bank regulatory
requirements and capital guidelines.
Restrictions on ownership
The Bank Holding Company Act generally would prohibit any company
that is not engaged in banking activities and activities that are permissible
for a bank holding company or a financial holding company from acquiring
control of us. Control is generally defined as ownership of 25% or more of the
voting stock or other exercise of a controlling influence. In addition, any
existing bank holding company would require the prior approval of the Federal
Reserve Board before acquiring 5% or more of our voting stock. In addition,
the Change in Bank Control Act of 1970, as amended, prohibits a person or
group of persons from acquiring "control" of a bank holding company unless the
Federal Reserve Board has been notified and has not objected to the
transaction. Under a rebuttable presumption established by the Federal Reserve
Board, the acquisition of 10% or more of a class of
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voting stock of a bank holding company with a class of securities registered
under Section 12 of the Exchange Act, such as us would, under the
circumstances set forth in the presumption, constitute acquisition of control
of the bank holding company.
U.S. Bancorp Amended and Restated Dividend Reinvestment Stock Purchase Plan
Under our U.S. Bancorp Dividend Reinvestment and Stock Purchase
Plan, or "DRIP," we provide eligible stockholders with a method of investing
cash dividends and optional cash payments at 100% of the average market price
(as defined in the DRIP) in additional shares of our common stock without all
administrative fees and expenses related to the DRIP. The DRIP includes some
dollar limitations on participation. Stockholders who are eligible to elect
dividend reinvestment may choose to participate in the DRIP with respect to
some of their shares and not to participate with respect to others. If
stockholders choose not to participate in the DRIP with respect to some or all
of their shares, any dividends payable on those shares will be paid in cash
and will not be reinvested in our common stock.
Shareholder rights plan
We have a shareholder rights plan that could discourage unwanted or
hostile takeover attempts that are not approved by our board. On February 27,
2001, our board declared a dividend of one preferred share purchase right for
each outstanding share of our common stock as of March 9, 2001. The rights
currently trade with, and are inseparable from, the common stock.
Each right allows its holder to purchase from us one one-thousandth
of a share of our Series A Junior Participating Preferred Stock for $100, once
the rights become exercisable. This portion of a preferred share will give the
shareholder approximately the same dividend and liquidation rights as would
one share of common stock. Before exercise, a right does not give its holder
any dividend, voting or liquidation rights.
The right will not be exercisable until the earlier of:
o 10 days after a public announcement that a person or group has
obtained beneficial ownership of 10% or more of our outstanding
common stock; or
o 10 business days (or a later date determined by our board
before any person or group has obtained beneficial ownership
of 10% or more of our outstanding common stock) after a person
or group begins a tender or exchange offer that, if completed,
would result in that person or group becoming the beneficial
owner of 10% or more of our outstanding common stock.
The date when the rights become exercisable is referred to in the
rights plan as the "distribution date." After that date, the rights will
separate from the common stock and will be evidenced by book-entry credits or
by rights certificates that we will mail to all eligible holders of common
stock. A person or member of a group that has obtained beneficial ownership of
10% or more of our outstanding common stock may not exercise any right even
after the distribution date.
A person or group that acquires beneficial ownership of 10% or more
of our outstanding common stock is called an "acquiring person."
o FLIP IN. If a person or group becomes an acquiring person, all
holders of rights other than the acquiring person may purchase
shares of our common stock at half their market value.
o FLIP OVER. If, after a person or group becomes an acquiring
person, we are acquired by another entity in a merger or
similar transaction, all holders of rights other than the
acquiring person may purchase shares of the acquiring company
at half their market value.
Our board may redeem the rights for $.0l per right at any time
before a person or group becomes an acquiring person. If the board redeems any
rights, it must redeem all of the rights. Once the rights are redeemed, the
only right of the holders of rights will be to receive the redemption price of
$.0l per right.
Our board may adjust the purchase price of the preferred shares, the
number of preferred shares issuable and the number of outstanding rights to
prevent dilution that may occur from a stock dividend, a stock split or a
26
reclassification of the preferred shares or common stock. No adjustments to
the exercise price of less than 1% will be made.
The terms of the rights plan may be amended by our board without the
consent of the holders of the rights. However, after a person or group becomes
an acquiring person, the board may not amend the plan in a way that adversely
affects the holders of the rights.
Share repurchase plan
Our board of directors recently approved a plan to repurchase 56.4
million shares of our outstanding common stock to replace shares issued in
connection with our acquisition of NOVA Corporation and we have contracted
with Citibank, N.A. (which is the trustee) to purchase shares of our common
stock on a forward basis pursuant to this plan. At our election, the contract
allows settlements on a physical basis or, subject to certain conditions, on a
net basis in shares of our common stock or in cash. To the extent that the
market price of our common stock on a settlement date is greater than the
forward purchase price, if we elect cash settlement rather than delivery of
shares we will receive the net differential. To the extent that the market
price of our common stock on a settlement date is lower than the forward
purchase price, if we elect cash settlement rather than delivery of shares we
will pay the net differential.
27
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
In the opinion of Simpson Thacher & Bartlett, the following is a
summary of the material United States federal income tax consequences of the
purchase, ownership, and disposition of CZARS, and where noted, the common
stock, as of the date of this prospectus. Except where noted, this summary
deals only with a CZARS held as a capital asset by a United States holder, and
it does not deal with holders in special situations. For example, this summary
does not address:
o tax consequences to holders who may be subject to special tax
treatment, such as dealers in securities or currencies,
traders in securities that elect to use the mark-to-market
method of accounting for their securities, financial
institutions, regulated investment companies, real estate
investment trusts, tax-exempt entities or insurance companies;
o tax consequences to persons holding CZARS as part of a
hedging, integrated, constructive sale or conversion
transaction or a straddle;
o tax consequences to holders of CZARS whose "functional
currency" is not the U.S. dollar;
o alternative minimum tax consequences, if any; or
o any state, local or foreign tax consequences.
The discussion below is based upon the provisions of the Internal
Revenue Code of 1986, as amended (the "Code"), and regulations, rulings and
judicial decisions as of the date of this prospectus. Those authorities may be
changed, perhaps retroactively, so as to result in United States federal
income tax consequences different from those discussed below.
If a partnership holds the CZARS, the tax treatment of a partner
will generally depend upon the status of the partner and the activities of the
partnership. If you are a partner of a partnership holding the CZARS, you
should consult your own tax advisors.
No statutory, administrative or judicial authority directly
addresses the treatment of the CZARS or similar instruments similar to the
CZARS for United States federal income tax purposes. No rulings have been
sought or are expected to be sought from the Internal Revenue Service, or the
IRS, with respect to any of the United States federal income tax consequences
discussed below, and no assurance can be given that the IRS will not take
contrary positions. As a result, no assurance can be given that the IRS will
agree with the tax characterizations and the tax consequences described below.
If you are considering the purchase of CZARS, you should consult
your own tax advisors concerning the federal income tax consequences in light
of your particular situation and any consequences arising under the laws of
any other taxing jurisdiction.
United States holders
The following discussion is a summary of certain United States
federal income tax consequences that will apply to you if you are a United
States holder of CZARS.
For purposes of this discussion, a United States holder is a
beneficial owner of a CZARS that is:
o a citizen or resident of the United States;
o a corporation or partnership created or organized in or under
the laws of the United States or any political subdivision of
the United States;
o an estate the income of which is subject to United States
federal income taxation regardless of its source; or
o a trust (1) that is subject to the primary supervision of a
court within the United States and the control of one or more
United States persons as defined in Section 7701(a)(30) of
the Code or (2)
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that has a valid election in effect under
applicable Treasury regulations to be treated as a United
States person.
Classification of the CZARS
Under the indenture governing the CZARS, we and each holder of the
CZARS agree, for United States federal income tax purposes, to treat the CZARS
as indebtedness that is subject to the regulations governing contingent
payment debt instruments (the "contingent debt regulations") in the manner
described below. The remainder of this discussion assumes that the CZARS will
be so treated and does not address any possible differing treatments of the
CZARS. However, the application of the contingent debt regulations to
instruments such as the CZARS is uncertain in several respects, and no rulings
have been sought from the IRS or a court with respect to any of the tax
consequences discussed below. Accordingly, no assurance can be given that the
IRS or a court will agree with the treatment described herein. Any differing
treatment could affect the amount, timing and character of income, gain or
loss in respect of an investment in the CZARS. In particular, a holder might
be required to accrue original issue discount at a lower rate, might not
recognize income, gain or loss upon conversion of the CZARS to common stock,
and might recognize capital gain or loss upon a taxable disposition of its
CZARS. Holders should consult their tax advisors concerning the tax treatment
of holding the CZARS.
Accrual of interest
Under the rules governing contingent payment debt obligations,
actual cash payments on the CZARS, including payments of contingent interest,
if any, will not be reported separately as taxable income, but will be taken
into account under such regulations. As discussed more fully below, the effect
of these contingent debt regulations will be to:
o require you, regardless of your usual method of tax
accounting, to use the accrual method with respect to the
CZARS;
o require you to accrue original issue discount at the
comparable yield (as described below) which will be
substantially in excess of interest payments actually received
by you; and
o generally result in ordinary rather than capital treatment of
any gain, and to some extent loss, on the sale, exchange,
repurchase or redemption of the CZARS.
You will be required to accrue an amount of original issue discount
for United States federal income tax purposes, for each accrual period prior
to and including the maturity date of the CZARS that equals:
o the product of (i) the adjusted issue price (as defined below)
of the CZARS as of the beginning of the accrual period; and
(ii) the comparable yield to maturity (as defined below) of
the CZARS, adjusted for the length of the accrual period;
o divided by the number of days in the accrual period; and
o multiplied by the number of days during the accrual period
that you held the CZARS.
The issue price of a CZARS was the first price at which a
substantial amount of the CZARS was sold to the public, excluding bond houses,
brokers or similar persons or organizations acting in the capacity of
underwriters, placement agents or wholesalers. The adjusted issue price of a
CZARS will be its issue price increased by any original issue discount
previously accrued, determined without regard to any adjustments to original
issue discount accruals described below, and decreased by the projected
amounts of any payments previously made with respect to the CZARS. If you
purchase a CZARS at a price other than its issue price, see the discussion
under "--Purchasers of CZARS at a price other than the adjusted issue price."
Under the contingent debt regulations, you will be required to
include original issue discount in income each year, regardless of your usual
method of tax accounting, based on the comparable yield of the CZARS. We have
determined the comparable yield of the CZARS based on the rate, as of the
initial issue date, at which we would issue a fixed rate nonconvertible debt
instrument with no contingent payments but with terms and conditions similar
to the CZARS. Accordingly, we have determined that the comparable yield is an
annual rate of 7.03%, compounded semi-annually.
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We are required to furnish annually to you the comparable yield and,
solely for tax purposes, a projected payment schedule that includes the actual
interest payments, if any, on the CZARS and estimates the amount and timing of
contingent interest payments and payment upon maturity on the CZARS taking
into account the fair market value of the common stock that might be paid upon
a conversion of the CZARS. You may obtain the projected payment schedule by
submitting a written request for it to us at the address set forth in "Where
You Can Find More Information". By purchasing the CZARS, you agree in the
indenture to be bound by our determination of the comparable yield and
projected payment schedule. For United States federal income tax purposes, you
must use the comparable yield and the schedule of projected payments in
determining your original issue discount accruals, and the adjustments thereto
described below, in respect of the CZARS.
The comparable yield and the projected payment schedule are not
provided for any purpose other than the determination of your original issue
discount and adjustments thereof in respect of the CZARS and do not constitute
a projection or representation regarding the actual amount of the payment on a
CZARS.
Adjustments to interest accruals on the CZARS
If the actual contingent payments made on the CZARS differ from the
projected contingent payments, adjustments will be made for the difference.
If, during any taxable year, you receive actual payments with respect to the
CZARS for that taxable year that in an aggregate exceed the total amount of
projected payments for the taxable year, you will incur a positive adjustment
equal to the amount of such excess. Such positive adjustment will be treated
as additional original issue discount in such taxable year. For these
purposes, the payments in a taxable year include the fair market value of
property received in that year. If you receive in a taxable year actual
payments with respect to the CZARS for that taxable year that in the aggregate
are less than the amount of projected payments for that taxable year, you will
incur a negative adjustment equal to the amount of such deficit. A negative
adjustment will:
o first, reduce the amount of original issue discount required
to be accrued in the current year;
o second, any negative adjustments that exceed the amount of
original issue discount accrued in the current year will be
treated as ordinary loss to the extent of your total prior
original issue discount inclusions with respect to the CZARS,
reduced to the extent such original issue discount was offset
by prior negative adjustments; and
o third, any excess negative adjustments will be treated as a
regular adjustment in the succeeding taxable year.
Sale, exchange, conversion or redemption
Upon the sale, exchange, conversion, repurchase or redemption of a
CZARS, you will recognize gain or loss equal to the difference between your
amount realized and your adjusted tax basis in the CZARS. As a holder of a
CZARS, you agree that under the contingent debt regulations, we will report
the amount realized as including the fair market value of our stock that you
receive on conversion as a contingent payment. Such gain on a CZARS generally
will be treated as ordinary income. Loss from the disposition of a CZARS will
be treated as ordinary loss to the extent of your prior net original issue
discount inclusions with respect to the CZARS. Any loss in excess of that
amount will be treated as capital loss, which will be long-term if the CZARS
was held for greater than one year. The deductibility of net capital losses by
individuals and corporations is subject to limitations.
Special rules apply in determining the tax basis of a CZARS. Your
basis in a CZARS is generally increased by original issue discount you
previously accrued on the CZARS, and reduced by the projected amount of any
payments previously scheduled to be made.
Under this treatment, your tax basis in the common stock received
upon conversion of a CZARS will equal the then current fair market value of
such common stock. Your holding period for our common stock received will
commence on the day of conversion.
Given the uncertain tax treatment of instruments such as CZARS, you
should contact your tax advisers concerning the tax treatment on conversion of
a CZARS and the ownership of the common stock.
30
Purchasers of CZARS at a price other than the adjusted issue price
If you purchase a CZARS in the secondary market for an amount that
differs from the adjusted issue price of the CZARS at the time of purchase,
you will be required to accrue interest income on the CZARS in accordance with
the comparable yield even if market conditions have changed since the date of
issuance. The rules for accruing bond premium, acquisition premium and market
discount will not apply. Instead, you must reasonably determine whether the
difference between the purchase price for a CZARS and the adjusted issue price
of a CZARS is attributable to a change in expectations as to the contingent
amounts potentially payable in respect of the CZARS, a change in interest
rates since the CZARS were issued, or both, and allocate the difference
accordingly.
Adjustments allocated to a change in interest rates will cause, as
the case may be, a "positive adjustment" or a "negative adjustment" to your
interest inclusion. If the purchase price of a CZARS is less than its adjusted
issue price, a positive adjustment will result, and if the purchase price is
more than the adjusted issue price of a CZARS, a negative adjustment will
result. To the extent that an adjustment is attributable to a change in
interest rates, it must be reasonably allocated to the daily portions of
interest over the remaining term of the CZARS.
To the extent that the difference between your purchase price for
the CZARS and the adjusted issue price of the CZARS is attributable to a
change in expectations as to the contingent amounts potentially payable in
respect of the CZARS (and not to a change in the market interest rates), you
will be required to reasonably allocate that difference to the contingent
payments. Adjustments allocated to the contingent payments will be taken into
account when the contingent payments are made. Any negative or positive
adjustment of the kind described above made by you will decrease or increase,
respectively, your tax basis in the CZARS.
Certain United States holders will receive Forms 1099-OID reporting
interest accruals on their CZARS. Those forms will not, however, reflect the
effect of any positive or negative adjustments resulting from your purchase of
a CZARS in the secondary market at a price that differs from its adjusted
issue price on the date of purchase. You are urged to consult your tax advisor
as to whether, and how, such adjustments should be made to the amounts
reported on any Form 1099-OID.
Constructive distributions
The conversion price of the CZARS will be adjusted in certain
circumstances. Under section 305(c) of the Code, adjustments (or failures to
make adjustments) that have the effect of increasing your proportionate
interest in our assets or earnings may in some circumstances result in a
deemed distribution to you. Any deemed distributions will be taxable as a
dividend, return of capital, or capital gain in accordance with the earnings
and profits rules under the Code.
Tax event
The modification of the terms of the CZARS by us upon a Tax Event
could possibly alter the timing of income recognition by you with respect to
payments of interest due after the Tax Event.
Backup withholding and information reporting
If you are a United States holder of CZARS, information reporting
requirements will generally apply to all payments we make to you and the
proceeds from a sale of a CZARS or share of common stock received by you,
unless you are an exempt recipient such as a corporation. Backup withholding
tax will apply to those payments if you fail to provide a taxpayer
identification number, or a certification of exempt status, or if you fail to
report in full interest income.
Any amounts withheld under the backup withholding rules may be
allowed as a refund or a credit against your United States federal income tax
liability provided the required information is furnished to the IRS.
Non-United States holders
The following is a summary of the United States federal tax
consequences that will apply to you if you are a non-United States holder of
CZARS or shares of common stock. The term "non-United States holder" means a
beneficial owner of a CZARS that is not a United States holder.
Special rules may apply to certain non-United States holders such as
"controlled foreign corporations", "passive foreign investment companies",
"foreign personal holding companies", corporations that accumulate
31
earnings to avoid federal income tax or, in certain circumstances, United
States expatriates and these non-United States holders should consult their
own tax advisors to determine the United States federal, state, local and
other tax consequences that may be relevant to them.
Payments with respect to the CZARS
Amounts attributable to contingent interest will not be exempt from
United States federal income or withholding tax and, therefore, non-United
States holders will be subject to withholding on payments of contingent
interest at a rate of 30%, subject to reduction by an applicable treaty or
upon the receipt of an IRS Form W-8ECI from a non-United States holder
claiming that the payments are effectively connected with the conduct of a
United States trade or business.
The 30% United States federal withholding tax will not apply to any
other payments on the CZARS made to you of principal or interest (other than
amounts attributable to contingent interest), including a payment in common
stock pursuant to a conversion, provided that:
o you do not actually or constructively own 10% or more of the
total combined voting power of all classes of our stock that
are entitled to vote within the meaning of Section 871(h)(3)
of the Code;
o you are not a controlled foreign corporation that is related
to us through stock ownership;
o you are not a bank whose receipt of interest (including
original issue discount) on a CZARS is described in Section
881(c)(3)(A) of the Code;
o (a) you provide your name and address, and certify, under
penalties of perjury, that you are not a United States person
(which certification may be made on an IRS W-8BEN (or
successor form)) or (b) you hold your CZARS through certain
foreign intermediaries and you satisfy the certification
requirements of applicable Treasury regulations. Special
certification rules apply to holders that are pass-through
entities; and
o our common stock continues to be actively traded within the
meaning of Section 871(h)(4)(C)(v)(I) of the Code and we
are not a "United States real property holding corporation".
If you cannot satisfy the requirements described above, payments of
interest (including original issue discount) will be subject to the 30% United
States federal withholding tax, unless you provide us with a properly executed
(1) IRS Form W-8BEN (or successor form) claiming an exemption from or
reduction in withholding under the benefit of an applicable tax treaty or (2)
IRS Form W-8ECI (or successor form) stating that interest (including original
issue discount) paid on the CZARS is not subject to withholding tax because it
is effectively connected with your conduct of a trade or business in the
United States.
If you are engaged in a trade or business in the United States and
interest (including original issue discount) on a CZARS is effectively
connected with the conduct of that trade or business, you will be subject to
United States federal income tax on that interest on a net income basis
(although exempt from the 30% withholding tax if you comply with certain
certification and disclosure requirements) in the same manner as if you were a
United States person as defined under the Code. In addition, if you are a
foreign corporation, you may be subject to a "branch profits tax" equal to 30%
(or lower applicable treaty rate) of your earnings and profits for the taxable
year, subject to adjustments, that are effectively connected with your conduct
of a trade or business in the United States. For this purpose, interest
(including original issue discount) will be included in the earnings and
profits of such foreign corporation.
Payments on common stock and constructive dividends
Any dividends paid to you with respect to the shares of common stock
(and any deemed dividends resulting from certain adjustments, or failure to
make adjustments, to the number of shares of common stock to be issued upon
conversion, see "--Constructive distributions" above) will be subject to
withholding tax at a 30% rate or a lower rate as may be specified by an
applicable income tax treaty. However, dividends that are effectively
connected with the conduct of a trade or business within the United States
and, where a tax treaty applies, are attributable to a United States permanent
establishment, are not subject to the withholding tax, but instead are subject
to United States federal income tax on a net income basis at applicable
graduated individual or corporate rates. Certain certification and disclosure
requirements must be complied with in order for effectively connected income
to be
32
exempt from withholding. Any such effectively connected dividends received by
a foreign corporation may, under certain circumstances, be subject to an
additional "branch profits tax" at a 30% rate or a lower rate as may be
specified by an applicable income tax treaty.
A non-United States holder of shares of common stock who wishes to
claim the benefit of an applicable treaty rate is required to satisfy
applicable certification and other requirements. If you are eligible for a
reduced rate of United States withholding tax pursuant to an income tax
treaty, you may obtain a refund of any excess amounts withheld by filing an
appropriate claim for refund with the IRS.
Sale, exchange or redemption of shares of common stock
Any gain realized upon the sale, exchange, redemption or other
disposition of a share of common stock generally will not be subject to United
States federal income tax unless:
o that gain is effectively connected with the conduct of a trade
or business in the United States by you,
o you are an individual who is present in the United States for
183 days or more in the taxable year of that disposition, and
certain other conditions are met, or
o we are or have been a "United States real property holding
corporation" for United States federal income tax purposes and
you hold or held more than five percent of our common stock at
any time during the shorter of the five year period preceding
the date of disposition or your holding period.
An individual non-United States holder described in the first bullet
point above will be subject to United States federal income tax on the net
gain derived from the sale. An individual non-United States holder described
in the second bullet point above will be subject to a flat 30% United States
federal income tax on the gain derived from the sale, which may be offset by
United States source capital losses, even though the holder is not considered
a resident of the United States. A non-United States holder that is a foreign
corporation and is described in the first bullet point above will be subject
to tax on gain under regular graduated United States federal income tax rates
and, in addition, may be subject to a branch profits tax at a 30% rate or a
lower rate if so specified by an applicable income tax treaty.
We believe that we are not and do not anticipate becoming a "United
States real property holding corporation" for United States federal income tax
purposes. If we are or become a "United States real property holding
corporation" and our common stock is and continues to be regularly traded on
an established securities market only a non-United States holder of common
stock who holds or held (at any time during the shorter of the five year
period preceding the date of disposition or the holder's holding period) more
than five per cent our common stock will be subject to United States federal
income tax on the disposition of our common stock.
United States federal estate tax
The United States federal estate tax will not apply to CZARS owned
by you at the time of your death, provided that (1) you do not own 10% or more
of the total combined voting power of all classes of our voting stock (within
the meaning of the Code and the United States Treasury regulations) and (2)
interest on the CZARS would not have been, if received at the time of your
death, effectively connected with your conduct of a trade or business in the
United States. However, shares of common stock held by you at the time of your
death will be included in your gross estate for United States federal estate
tax purposes unless an applicable estate tax treaty provides otherwise.
Backup withholding and information reporting
In general, if you are a non-United States holder you will not be
subject to backup withholding and information reporting with respect to
payments that we make to you provided that we do not have actual knowledge or
reason to know that you are a United States person and you have given us the
statement described above under "--Payments with respect to the CZARS." We
must report annually to the IRS and to each non-United States holder the
amount of dividends paid to that holder and the tax withheld with respect to
those dividends, regardless of whether withholding was required.
In addition, if you are a non-United States holder you will not be
subject to backup withholding or information reporting with respect to the
proceeds of the sale of a CZARS or share of common stock within the United
States or conducted through certain United States-related financial
intermediaries, if the payor receives the
33
statement described above and does not have actual knowledge that you are a
United States person, as defined under the Code, or you otherwise establish
an exemption.
Any amounts withheld under the backup withholding rules will be
allowed as a refund or a credit against your United States federal income tax
liability provided the required information is furnished to the IRS.
34
CERTAIN ERISA CONSIDERATIONS
The United States Employee Retirement Income Security Act of 1974,
as amended ("ERISA") imposes certain restrictions on "employee benefit plans"
(as defined in Section 3(3) of ERISA) that are subject to the fiduciary
responsibility provisions of ERISA ("ERISA Plans") and on persons who are
fiduciaries with respect to ERISA Plans. In accordance with ERISA's general
fiduciary requirements, a fiduciary with respect to any ERISA Plan who is
considering the purchase of any CZARS on behalf of that ERISA Plan should
determine whether that purchase is permitted under the governing documents of
the ERISA Plan and is prudent and appropriate for the ERISA Plan in view of
its overall investment policy and the composition and diversification of its
portfolio.
Prohibited transaction issues
ERISA and Section 4975 of the Code prohibit certain transactions
involving the assets of an ERISA Plan or of a plan described in Section
4975(e)(l) of the Code (including an individual retirement arrangement) that
is subject to Section 4975 of the Code (together with ERISA Plans, "Plans")
and persons who have certain specified relationships to the Plan ("parties in
interest" within the meaning of ERISA or "disqualified persons" within the
meaning of Section 4975 of the Code). Thus, a Plan fiduciary considering the
purchase of CZARS should consider whether such a purchase might constitute or
result in a prohibited transaction under ERISA or Section 4975 of the Code.
We, directly or through our respective affiliates, may be considered
a party in interest or a disqualified person with respect to Plans. The
purchase and holding of CZARS by a Plan (or any other entity whose assets
include Plan assets that are subject to the fiduciary responsibility
provisions of ERISA or the prohibited transaction provisions of Section 4975
of the Code) with respect to which we or any of our affiliates is a service
provider (or otherwise is a party in interest or a disqualified person) may
constitute or result in a prohibited transaction under ERISA or Section 4975
of the Code, unless the CZARS are acquired pursuant to and in accordance with
an applicable exemption. Certain exemptions from the prohibited transaction
provisions of Section 406 of ERISA and Section 4975 of the Code may be
applicable, depending in part on the type of Plan fiduciary making the
decision to acquire the CZARS and the circumstances under which the decision
is made. Included among these exemptions are Prohibited Transaction Class
Exemption ("PTCE") 84-14 (for certain transactions engaged in by an
independent qualified professional asset manager), PTCE 91-38 (for certain
transactions involving bank collective investment funds), PTCE 90-1 (for
certain transactions involving insurance company pooled separate accounts),
PTCE 95-60 (for certain transactions involving insurance company general
accounts) or PTCE 96-23 (for certain transactions engaged in by an in-house
asset manager).
Plan asset issues
ERISA and the Code do not define "plan assets." However, regulations
(the "Plan Assets Regulation") promulgated under ERISA by the U.S. Department
of Labor generally provide that when an ERISA Plan acquires an equity interest
in an entity that is neither a "publicly-offered security" nor a security
issued by an investment company registered under the U.S. Investment Company
Act, the ERISA Plan's assets include both the equity interest and an undivided
interest in each of the underlying assets of the entity unless it is
established either that equity participation in the entity by "benefit plan
investors" is not significant or that the entity is an "operating company," in
each case as defined in the Plan Assets Regulation. Since the CZARS may be
converted into our common stock, there can be no assurance that equity
participation in us by benefit plan investors will not be significant.
Although no assurances can be given, we believe that our underlying assets
will not be plan assets for purpose of ERISA and the Code.
If our assets were deemed to be "plan assets" under ERISA, however,
this would result, among other things, in (i) the application of the prudence
and other fiduciary responsibility standards of ERISA to investments made by
us, and (ii) the possibility that certain transactions in which we might seek
to engage could constitute "prohibited transactions" under ERISA and the Code.
Governmental plans, certain church plans and non-United States
plans, while not subject to the fiduciary responsibility provisions of ERISA
or the provisions of Section 4975 of the Code, may nevertheless be subject to
local, state, federal, non-U.S. or other laws that are substantially similar
to the foregoing provisions of ERISA or the Code ("Similar Laws"). Fiduciaries
of any such plans should consult with their counsel before purchasing any
CZARS.
35
Because of the foregoing, the CZARS should not be purchased or held
by any person investing "plan assets" of any plan, unless the purchase and
holding will not constitute a non-exempt prohibited transaction under ERISA or
the Code or a violation of any applicable Similar Laws. Accordingly, by its
purchase of a CZARS, each holder will be deemed to have represented and
warranted on each day from and including the date of its purchase of a CZARS
through and including the date of its disposition of the CZARS that the
acquisition, holding and disposition of such CZARS by that holder does not and
will not constitute a non-exempt prohibited transaction under ERISA or Section
4975 of the Code or a violation of any Similar Laws.
The sale of any CZARS to a plan is in no respect a representation by
us that such an investment meets all relevant legal requirements with respect
to investments by plans generally or any particular plan, or that such an
investment is appropriate for plans generally or any particular plan.
The foregoing discussion is general in nature and is not intended to
be all-inclusive. Due to the complexity of the rules and the penalties that
may be imposed upon persons involved in non-exempt prohibited transactions,
fiduciaries, or other persons considering purchasing the CZARS on behalf of,
or with the assets of, any employee benefit plan, should consult with their
advisors and/or counsel regarding the matters described herein.
36
SELLING SECURITYHOLDERS
The CZARS were originally issued by us and sold to Salomon Smith
Barney Inc. and U.S. Bancorp Piper Jaffray, Inc. (the "Initial Purchasers")
and resold by the Initial Purchasers in transactions exempt from the
registration requirements of the Securities Act to persons reasonably believed
by the Initial Purchasers to be "qualified institutional buyers" as defined by
Rule 144A under the Securities Act. The selling securityholders may from time
to time offer and sell pursuant to this prospectus any or all of the CZARS
listed below and the shares of common stock issued upon conversion of the
CZARS. When we refer to the "selling securityholders" in this prospectus, we
mean those persons listed in the table below, as well as future holders of
CZARS and the shares of common stock issued upon conversion of the CZARs and
the pledgees, donees, assignees, transferees, successors and others who later
hold any of the selling securityholders' interests.
The table below sets forth the name of each selling securityholder,
the principal amount at maturity of CZARS that each selling securityholder may
offer pursuant to this prospectus and the number of shares of common stock
into which those CZARS are convertible. Unless set forth below, to the best of
our knowledge, none of the selling securityholders has, or within the past
three years has had, any material relationship with us or any of our
predecessors or affiliates or beneficially owns in excess of 10% of our
outstanding common stock.
We have prepared the table below based on information given to us by
the selling securityholders on or prior to October 31, 2001. However, any or
all of the CZARS or shares of common stock listed below may be offered for
sale pursuant to this prospectus by the selling securityholders from time to
time. Accordingly, no estimate can be given as to the amounts of CZARS or
shares of common stock that will be held by the selling securityholders upon
consummation of any sales. In addition, the selling securityholders listed in
the table below may have acquired, sold or transferred, in transactions exempt
from the registration requirements of the Securities Act, some or all of their
CZARS since the date as of which the information in the table is presented.
Information about the selling securityholders may change over time.
Any changed information will be set forth in prospectus supplements to this
prospectus. From time to time, additional information concerning ownership of
the CZARS and shares of common stock may rest with certain holders of the
CZARS not named in the table below and of whom we are unaware.
Number of
Shares of
Aggregate Principal Percentage Common Stock Percentage of
Amount at Maturity of of CZARS That May be Common Stock
Name CZARS That May be Sold Outstanding Sold(1) Outstanding(2)
AIG SoundShare
Holdings Ltd. $7,271,000 * 175,543 *
AIG SoundShare Opportunity
Holding Fund Ltd. 2,031,000 * 49,034 *
AIG SoundShare Strategic
Holding Fund Ltd. 1,198,000 * 28,923 *
Allstate Insurance Company 5,100,000 * 123,129 *
Allstate Life Insurance
Company 9,400,000 * 226,944 *
Aloha Airlines Non-Pilots
Pension Trust 125,000 * 3,017 *
Aloha Pilots Retirement Trust 70,000 * 1,690 *
Bankers Trust Company trustee
for DaimlerChrysler
Corp. EMP#1 Pension
Plan, dated April 1, 1989 6,270,000 * 151,376 *
C & H Sugar Company Inc. 175,000 * 4,225 *
Commonwealth Professional
Assurance Co. c/o Income
Research & Management 800,000 * 19,314 *
Conseco Annuity Assurance
Company-Multi-Bucket
Annuity Convertible Bond
Fond 5,500,000 * 132,786 *
37
Credit Suisse First Boston
Corp. 100,500,000 6.8% 2,426,371 *
Drury University 50,000 * 1,207 *
Excellus Health Plan c/o
Income Research &
Management 2,925,000 * 70,618 *
First Union National Bank 13,000,000 * 313,859 *
Franklin & Marshall College 360,000 * 8,691 *
Gaia Offshore Master Fund Ltd. 13,910,000 * 335,829 *
Granville Capital Corporation 30,000,000 2.0% 724,290 *
Hawaiian Airlines Employees
Pension Plan - IAM 60,000 * 1,448 *
Hawaiian Airlines Pension
Plan for Salaried
Employees 10,000 * 241 *
Hawaiian Airlines Pilots
Retirement Plan 110,000 * 2,655 *
Lyxor Master Fund 1,090,000 * 26,315 *
MedAmerica Insurance Co. c/o
Income Research &
Management 1,725,000 * 41,646 *
MedAmerica New York Insurance
Co. c/o Income Research
& Management 750,000 * 18,107 *
Penn Treaty Network America
Insurance Company 475,000 * 11,467 *
RAM Trading Ltd. 10,000,000 * 241,430 *
Salomon Smith Barney Inc. 29,074,000 2.0% 701,933 *
SAM Investments 75,000,000 5.1% 1,810,725 *
State of Oregon/SAIF
Corporation 4,200,000 * 101,400 *
State Street Bank custodian
for GE Pension Trust 2,895,000 * 69,893 *
TIERS Floating Rate
Certificates Trust Series
2001-20 458,026,000 30.9% 11,058,121 *
TIERS Floating Rate
Certificates Trust Series
2001-22 219,176,000 14.8% 5,291,566 *
TIERS Floating Rate
Certificates Trust Series
2001-23 130,865,000 8.8% 3,159,473 *
Tufts Associated Health Plans
c/o Income Research &
Management 1,550,000 * 37,421 *
UBS AG, London Branch 50,000,000 3.4% 1,207,150 *
UBS AG, London Branch 2,000,000 * 48,286 *
UBS O'Connor f/b/o Global
Equity Arbitrage Master
Ltd. 35,000,000 2.4% 845,005 *
University of Massachusetts
c/o Income Research &
Management 250,000 * 6,035 *
Y & H Soda Foundation 135,000 * 3,259 *
All other holders of CZARS or
future transferees,
pledgees, donees, assignees
or successors of any
holders(3)(4)............. $ 262,103,000 17.7% 6,327,952 *
Total....................... $1,483,179,000 100% 35,808,390 1.8%
* Less than one percent (1%).
(1) Assumes conversion of all of the holder's CZARS at a conversion rate of
24.1430 shares of common stock per $1,000 principal amount at maturity
of the CZARS. This conversion rate is subject to adjustment, however, as
described under "Description of the CZARS--Conversion rights." As a
result, the number of shares of common stock issuable upon conversion of
the CZARS may increase or decrease in the future.
38
(2) Calculated based on Rule 13d-3(d)(1)(i) of the Exchange Act, using
1,969,001,279 shares of common stock outstanding as of September 30,
2001. In calculating this amount for each holder, we treated as
outstanding the number of shares of common stock issuable upon
conversion of all of that holder's CZARS, but we did not assume
conversion of any other holder's CZARS.
(3) Information about other selling securityholders will be set forth in
prospectus supplements, if required.
(4) Assumes that any other holders of CZARS, or any future pledgees, donees,
assignees, transferees or successors of or from any other holders of
CZARS, do not beneficially own any shares of common stock other than the
common stock issuable upon conversion of the CZARS at the initial
conversion rate.
39
PLAN OF DISTRIBUTION
We are registering the CZARS and shares of common stock covered by
this prospectus to permit holders to conduct public secondary trading of these
securities from time to time after the date of this prospectus. We have
agreed, among other things, to bear all expenses, other than underwriting
discounts and selling commissions, in connection with the registration and
sale of the CZARS and the shares of common stock covered by this prospectus.
We will not receive any of the proceeds from the offering of CZARS
or the shares of common stock by the selling securityholders. We have been
advised by the selling securityholders that the selling securityholders may
sell all or a portion of the CZARS and shares of common stock beneficially
owned by them and offered hereby from time to time:
o directly; or
o through underwriters, broker-dealers or agents, who may
receive compensation in the form of underwriting discounts
or commissions or agent's commissions from the selling
securityholders or from the purchasers of the CZARS and
common stock for whom they may act as agent.
The CZARS and the common stock may be sold from time to time in one
or more transactions at:
o fixed prices;
o prevailing market prices at the time of sale;
o varying prices determined at the time of sale; or
o negotiated prices.
These prices will be determined by the holders of the securities or by
agreement between these holders and underwriters or dealers who may receive
fees or commissions in connection with the sale. The aggregate proceeds to the
selling securityholders from the sale of the CZARS or shares of common stock
offered by them hereby will be the purchase price of the CZARS or shares of
common stock less discounts and commissions, if any.
The sales described in the preceding paragraph may be effected in
transactions:
o on any national securities exchange or quotation service on
which the CZARS and common stock may be listed or quoted at
the time of sale, including the New York Stock Exchange in
the case of the common stock;
o in the over-the-counter market; or
o through the writing of options.
These transactions may include block transactions or crosses.
Crosses are transactions in which the same broker acts as an agent on both
sides of the trade.
In connection with the sales of the CZARS and the shares of common
stock or otherwise, the selling securityholders may enter into hedging
transactions with broker-dealers, which may in turn engage in short sales of
the CZARS and the shares of common stock, short and deliver CZARS and the
shares of common stock to close out such short positions, or loan or pledge
CZARS and the shares of common stock to broker-dealers that in turn may sell
the CZARS and the shares of common stock.
To our knowledge, there are currently no plans, arrangements or
understandings between any selling securityholders and any underwriter,
broker-dealer or agent regarding the sale of the CZARS and the shares of
common stock by the selling securityholders. Selling securityholders may not
sell any, or may not sell all, of the CZARS and the shares of common stock
offered by them pursuant to this prospectus. In addition, we cannot assure you
that a selling securityholder will not transfer, devise or gift the CZARS and
the shares of common stock by other means not described in this prospectus. In
addition, any securities covered by this prospectus which qualify for
40
sale pursuant to Rule 144 or Rule 144A of the Securities Act may be sold under
Rule 144 or Rule 144A rather than pursuant to this prospectus.
The outstanding shares of common stock are listed for trading on the
New York Stock Exchange under the symbol "USB".
The selling securityholders and any broker and any broker-dealers,
agents or underwriters that participate with the selling securityholders in
the distribution of the CZARS or the shares of common stock may be deemed to
be "underwriters" within the meaning of the Securities Act. In this case, any
commissions received by these broker-dealers, agents or underwriters and any
profit on the resale of the CZARS or the shares of common stock purchased by
them may be deemed to be underwriting commissions or discounts under the
Securities Act. In addition, any profits realized by the selling
securityholders may be deemed to be underwriting commissions.
The CZARS were issued and sold in August 2001 in transactions exempt
from the registration requirements of the Securities Act to persons reasonably
believed by the Initial Purchasers to be "qualified institutional buyers," as
defined in Rule 144A under the Securities Act. We have agreed to indemnify
each selling securityholder (including the Initial Purchasers), and each
selling securityholder's directors, officers, employees, representatives,
agents, and each person, if any, who controls that selling securityholder
within the meaning of either the Securities Act or the Exchange Act, and each
selling securityholder (including the Initial Purchasers) has agreed to
indemnify us, our directors, officers, employees, representatives, agents, and
each person, if any, who controls us within the meaning of either the
Securities Act or the Exchange Act, against specified liabilities arising
under the Securities Act, the Exchange Act or other applicable law.
The selling securityholders and any other person participating in a
distribution will be subject to the Exchange Act. The Exchange Act rules
include, without limitation, Regulation M, which may limit the timing of
purchases and sales of any of the CZARS and the underlying shares of common
stock by the selling securityholders and any such other person. In addition,
Regulation M of the Exchange Act may restrict the ability of any person
engaged in the distribution of the CZARS and the underlying shares of common
stock to engage in market-making activities with respect to the particular
CZARS and the underlying shares of common stock being distributed for a period
of up to five business days prior to the commencement of the distribution.
This may affect the marketability of the CZARS and the underlying shares of
common stock and the ability of any person or entity to engage in
market-making activities with respect to the CZARS and the underlying shares
of common stock.
We will use our reasonable efforts to keep the registration
statement of which this prospectus is a part effective until the earlier of:
o the time when the CZARS and the underlying shares of common
stock can be sold under Rule 144 or any successor provision;
o the expiration of the holding period applicable to the CZARS
and the underlying shares of common stock held by persons
that are not our affiliates under Rule 144(k) under the
Securities Act or any successor provision; and
o the date on which all CZARS and the underlying shares of
common stock are disposed of in accordance with the
registration statement to which this prospectus relates.
We will be permitted to suspend the effectiveness of the shelf
registration statement and the use of this prospectus during specified periods
(not to exceed 45 days in any three month period or 90 days in the aggregate
in any 12 month period) in specified circumstances, including circumstances
relating to pending corporate developments. We need not specify the nature of
the event giving rise to a suspension in any notice to holders of the CZARS of
the existence of such a suspension. In these cases, we may prohibit offers and
sales of CZARS and shares of common stock pursuant to the registration
statement to which this prospectus relates.
41
LEGAL MATTERS
Certain legal matters with respect to the CZARS will be passed upon for us by
Jennie Carlson, Esq., Executive Vice President, Deputy General Counsel and
Secretary of U.S. Bancorp, and Simpson Thacher & Bartlett, New York, New York.
Simpson Thacher & Bartlett, New York, New York has also advised us as to
certain tax matters relating to the CZARS.
EXPERTS
Our consolidated financial statements as of December 31, 2000 and
1999 and for each of the three years in the period ended December 31, 2000,
incorporated in this prospectus by reference to our Current Report on Form 8-K
filed on April 17, 2001, have been so incorporated in reliance on the report
of PricewaterhouseCoopers LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
42
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
U.S. Bancorp is paying all of the selling securityholders' expenses
related to this offering, except the selling securityholders will pay any
applicable underwriting and broker's commissions and expenses. The following
table sets forth the approximate amount of fees and expenses payable by U.S.
Bancorp in connection with this registration statement and the distribution of
the CZARS and shares of common stock registered hereby. All of the amounts
shown are estimates except the SEC registration fee.
SEC registration fee................................$274,389
Accountant's Fees and Expenses........................$6,000
Attorneys' Fees and Expenses........................$100,000
Printing and engraving expenses...........................$0
Miscellaneous Expenses..................................$500
Total........................................$380,889
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law contains
detailed provisions for indemnification of directors and officers of Delaware
corporations against expenses, judgments, fines and settlements in connection
with litigation.
Article Ninth of U.S. Bancorp's Restated Certificate of
Incorporation, as amended, provides that a director will not be personally
liable to U.S. Bancorp or its stockholders for monetary damages for a breach
of fiduciary duty as a director, except for liability (1) for any breach of
the director's duty of loyalty to U.S. Bancorp or its stockholders, (2) for
acts or omissions not in good faith or which involve intentional misconduct or
a knowing violation of law, (3) under the Delaware statutory provision making
directors personally liable for unlawful dividends or unlawful stock
repurchases or redemptions or (4) for any transaction for which the directors
derived an improper personal benefit.
The bylaws of U.S. Bancorp provide that the officers and directors
of U.S. Bancorp and certain others will be indemnified to substantially the
same extent permitted by Delaware law.
U.S. Bancorp maintains a standard policy of officers' and directors'
insurance.
Item 16. Exhibits.
The following is a list of all exhibits filed as a part of this
registration statement on Form S-3, including those incorporated in this
registration statement by reference.
Exhibit
Number Description of Exhibits
4.1 Restated Certificate of Incorporation of the Registrant, as
amended (incorporated by reference to Exhibit 3.1 to the
Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000)
4.2 Restated Bylaws of the Registrant (incorporated by reference
to Exhibit 3.2 to the Registrant's Annual Report on Form 10-K
for the year ended December 31, 2000)
4.3 Indenture dated as of October 1, 1991 between the Registrant
and Citibank, N.A., as Trustee (incorporated by reference to
Exhibit 4.1 to the Registrant's Current Report on Form 8-K
dated November 12, 1991)
4.4 Supplemental Indenture dated as of August 6, 2001 between the
Registrant and Citibank, N.A., as Trustee
4.5 Form of Contingent Zero-Coupon Accreting Redeemable Securities
(CZARS) (Convertible Senior Notes) Due 2021 (included in
Exhibit 4.4)
4.6 Registration Rights Agreement dated as of August 6, 2001
between the Registrant, Salomon Smith Barney Inc. and U.S.
Bancorp Piper Jaffray Inc.
5.1 Opinion of Jennie Carlson, Esq., Executive Vice President,
Deputy General Counsel and Secretary of the Registrant
5.2 Opinion of Simpson Thacher & Bartlett
8.1 Opinion of Simpson Thacher & Bartlett as to certain U.S.
federal income tax matters
12.1 Statement re: Computation of Ratio of Earnings to Fixed
Charges (incorporated by reference to Exhibit 12.1 to the
Registrant's Registration Statement on Form S-3 (File Number
333-65358))
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Jennie Carlson, Esq., Executive Vice President,
Deputy General Counsel and Secretary of the Registrant
(included in Exhibit 5.1)
23.3 Consent of Simpson Thacher & Bartlett (included in
Exhibits 5.2 and 8.1)
24.1 Power of Attorney from directors of the Registrant signing
by an attorney-in-fact
25.1 Statement of Eligibility on Form T-1 under the Trust Indenture
Act of 1939, as amended, of Citibank, N.A. under the Indenture
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a Fundamental Change in the information set forth in this
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the SEC pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or any
material change to such information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the SEC
by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act
that are incorporated by reference in the registration statement;
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof; and
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
(b) 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 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 herein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to its articles, bylaws or otherwise, the
registrant has been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, 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
Securities Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Minneapolis, State of Minnesota, on
November 1, 2001.
U.S. BANCORP
By: /s/ Jerry A. Grundhofer
--------------------------------
Jerry A. Grundhofer
Title: President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Title Date
/s/ Jerry A. Grundhofer President, Chief Executive Officer and November 1, 2001
----------------------- Director (principal executive officer)
Jerry A. Grundhofer
/s/ David M. Moffett Vice Chairman, Chief Financial Officer November 1, 2001
-------------------- and Director (principal financial
David M. Moffett officer)
/s/ Terrance R. Dolan Senior Vice President and Controller November 1, 2001
--------------------- (principal accounting officer)
Terrance R. Dolan
/s/ John F. Grundhofer* Chairman and Director November 1, 2001
----------------------
John F. Grundhofer
/s/ Linda L. Ahlers* Director November 1, 2001
--------------------
Linda L. Ahlers
/s/ Victoria B. Buyniski Gluckman* Director November 1, 2001
----------------------------------
Victoria B. Buyniski Gluckman
/s/ Arthur D. Collins, Jr.* Director November 1, 2001
---------------------------
Arthur D. Collins, Jr.
/s/ Peter H. Coors* Director November 1, 2001
------------------
Peter H. Coors
/s/ John C. Dannemiller* Director November 1, 2001
------------------------
John C. Dannemiller
/s/ Joshua Green III* Director November 1, 2001
---------------------
Joshua Green III
/s/ J.P. Hayden, Jr.* Director November 1, 2001
--------------------
J.P. Hayden, Jr.
/s/ Roger L. Howe* Director November 1, 2001
------------------
Roger L. Howe
Director November 1, 2001
-----------------------
Thomas H. Jacobsen
/s/ Delbert W. Johnson* Director November 1, 2001
----------------------
Delbert W. Johnson
/s/ Joel W. Johnson* Director November 1, 2001
--------------------
Joel W. Johnson
/s/ Jerry W. Levin* Director November 1, 2001
-------------------
Jerry W. Levin
/s/ Sheldon B. Lubar* Director November 1, 2001
---------------------
Sheldon B. Lubar
/s/ Frank Lyon, Jr.* Director November 1, 2001
--------------------
Frank Lyon, Jr.
/s/ Daniel F. McKeithan, Jr.* Director November 1, 2001
-----------------------------
Daniel F. McKeithan, Jr.
/s/ David B. O'Maley* Director November 1, 2001
---------------------
David B. O'Maley
/s/ O'dell Owens, M.D., M.P.H.* Director November 1, 2001
-------------------------------
O'dell M. Owens, M.D., M.P.H.
/s/ Thomas E. Petry* Director November 1, 2001
--------------------
Thomas E. Petry
Director November 1, 2001
---------------------
Richard G. Reiten
/s/ S. Walter Richey* Director November 1, 2001
---------------------
S. Walter Richey
/s/ Warren R. Staley* Director November 1, 2001
---------------------
Warren R. Staley
Director November 1, 2001
----------------------
Patrick T. Stokes
/s/ John J. Stollenwerk * Director November 1, 2001
-------------------------
John J. Stollenwerk
*By: /s/Terrance R. Dolan
-------------------------
Terrance R. Dolan
Attorney-in-fact for the persons
indicated above with an *
Attorney-in-fact
EXHIBIT INDEX
Exhibit
Number Description of Exhibits
4.1 Restated Certificate of Incorporation of the Registrant, as
amended (incorporated by reference to Exhibit 3.1 to the
Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000)
4.2 Restated Bylaws of the Registrant (incorporated by reference
to Exhibit 3.2 to the Registrant's Annual Report on Form 10-K
for the year ended December 31, 2000)
4.3 Indenture dated as of October 1, 1991 between the Registrant
and Citibank, N.A., as Trustee (incorporated by reference to
Exhibit 4.1 to the Registrant's Current Report on Form 8-K
dated November 12, 1991)
4.4 Supplemental Indenture dated as of August 6, 2001 between the
Registrant and Citibank, N.A., as Trustee
4.5 Form of Contingent Zero-Coupon Accreting Redeemable Securities
(CZARS) (Convertible Senior Notes) Due 2021 (included in
Exhibit 4.4)
4.6 Registration Rights Agreement dated as of August 6, 2001
between the Registrant, Salomon Smith Barney Inc. and U.S.
Bancorp Piper Jaffray Inc.
5.1 Opinion of Jennie Carlson, Esq., Executive Vice President,
Deputy General Counsel and Secretary of the Registrant
5.2 Opinion of Simpson Thacher & Barlett
8.1 Opinion of Simpson Thacher & Bartlett as to certain U.S.
federal income tax matters
12.1 Statement re: Computation of Ratio of Earnings to Fixed
Charges (incorporated by reference to Exhibit 12.1 to the
Registrant's Registration Statement on Form S-3 (File Number
333-65358))
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Jennie Carlson, Esq., Executive Vice President,
Deputy General Counsel and Secretary of the Registrant
(included in Exhibit 5.1)
23.3 Consent of Simpson Thacher & Bartlett (included in
Exhibits 5.2 and 8.1)
24.1 Power of Attorney from directors of the Registrant signing by
an attorney-in-fact
25.1 Statement of Eligibility on Form T-1 under the Trust Indenture
Act of 1939, as amended, of Citibank, N.A. under the Indenture