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Nova Buys First Horizon Merchant Services Business; Adds 53,000 Merchants and Expands Hospitality Portfolio

ATLANTA--(BUSINESS WIRE)--Jan. 31, 2006--NOVA Information Systems (NOVA), a wholly owned subsidiary of U.S. Bancorp (NYSE:USB), today announced that it has entered into a definitive agreement to acquire the merchant processing business of First Horizon Merchant Services Inc. (FHMS), a wholly owned subsidiary of First Tennessee Bank and a part of First Horizon National Corp. (NYSE: FHN). This acquisition involves approximately 53,000 merchant locations in the United States, Canada and Puerto Rico, 400 employees, and FHMS systems, sales and operations centers based in Englewood, Colo., and Orlando, Fla.

FHMS is the second largest acquirer of hospitality transactions in the United States, and its portfolio also includes retail, restaurant, healthcare and automotive businesses. New merchant services will be marketed through a direct sales force and through a strategic alliance referral relationship with First Horizon National Corporation's 208 banks located in Tennessee, Mississippi, Virginia, Georgia and Texas. The credit and debit card processing volume from this agreement is expected to add approximately $25 billion annually to NOVA's processing business. Under the terms of the agreement, the transaction carries an initial purchase price of approximately $433 million, with the potential for a subsequent payment based on performance-related criteria.

"First Horizon is a well-established and highly recognized market leader with a history of strong performance and solid growth," said Pamela A. Joseph, chief executive officer, NOVA Information Systems. "Their impressive national merchant base, specialized product portfolio, network infrastructure and experienced staff complement our existing business and expand our reach into the travel and entertainment sector. We are honored that they have selected NOVA as a trustworthy partner to serve their clients' needs."

"Historically it has been important for us to be a processing solution company, one that creates value at every constituency level with unique internally controlled products," said Ronald R. Nation, president of First Horizon Merchant Services. "With the existing global processing attributes of NOVA, we can now provide uniform solutions to our global clients. More importantly, no other Visa or MasterCard licensee that I know of can do what we now can do around the world exclusive of reliance on third-party service bureaus."

The deal is expected to close in the first quarter of 2006. Additional information regarding this transaction can be found on U.S. Bancorp's website. To access the information, go to www.usbank.com and click on "About U.S. Bancorp" and then "Investor/Shareholder Information." The link to a slide presentation can be found under both "Press Releases" and "Webcasts and Presentations."

Pamela A. Joseph, chief executive officer, NOVA Information Systems, will host a conference call to discuss the transaction on Wednesday, February 1, 2006, at 9:00 am (EST). The call will be available by telephone or via webcast at www.usbank.com. To access the conference call, please dial 800-795-1259 and ask for the NOVA conference call. Participants calling from outside of the United States, please dial 785-832-1523. For those unable to participate during the live call, a recording of the call will be available approximately one hour after the conference call ends on Wednesday, February 1, 2006, and will run through Wednesday, February 8, 2006, at 11:59 p.m. (EST). To access the recorded message, please dial 888-276-5315. If calling from outside of the United States, please dial 402-220-2332. After February 8th, a recording of the call will continue to be available via webcast on the U.S. Bancorp website at www.usbank.com.

About First Horizon Merchant Services

First Horizon Merchant Services is part of First Horizon National Corp. (NYSE:FHN), whose 13,000 employees provide financial services to individuals and business customers through hundreds of offices located in more than 40 states. The corporation's three major brands -- FTN Financial, First Horizon and First Tennessee - provide customers with a broad range of products and services including: capital markets, one of the nation's top underwriters of U.S. government agency securities; mortgage banking, one of the nation's top 20 mortgage originators and top 15 servicers, which earned a top-10 ranking in customer satisfaction from J.D. Power and Associates; and retail/commercial banking, with the largest market share in Tennessee and one of the highest customer retention rates of any bank in the country.

FHN companies have been recognized as some of the nation's best employers by AARP, Working Mother and Fortune magazines. FHN also was named one of the nation's 100 best corporate citizens by Business Ethics magazine. For more information, visit www.fhnc.com.

About NOVA

NOVA Information Systems, a leader in the payment processing industry is a wholly owned subsidiary of U.S. Bancorp (NYSE:USB). Combined, NOVA and its affiliates euroConex and Elan, provide global merchant processing services to financial institutions and customers in the United States, Canada, and Europe. NOVA offers integrated payment processing services to more than 800,000 merchants. For more information, visit www.novainfo.com.

CONTACT: NOVA Information Systems
NOVA Media Relations:
Michelle Graff, 678-731-5064
michelle.graff@novainfo.com
or
First Horizon Merchant Services
Ronald R. Nation, 303-268-2688
RRNation@fhms.com
or
U.S. Bancorp
U.S. Bancorp Investor Relations
Judith Murphy, 612-303-0783
judith.murphy@usbank.com

SOURCE: NOVA Information Systems

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding U.S. Bancorp's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.



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