<PAGE> 1
Registration No. 33-______
As filed with the Securities and Exchange Commission on December 13, 1995
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
_________________________
FEDERATED DEPARTMENT STORES, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 5311 13-3324058
(State of Incorporation) (Primary Standard Industrial (I.R.S. Employer
Classification Code Number) Identification No.)
151 West 34th Street
New York, New York 10001
(212) 695-4400
and
7 West Seventh Street
Cincinnati, Ohio 45202
Telephone (513) 579-7000
(Principal Executive Offices)
Dennis J. Broderick, Esq.
Senior Vice President, General Counsel and Secretary
Federated Department Stores, Inc.
7 West Seventh Street
Cincinnati, Ohio 45202
(513) 579-7000
(Agent for Service)
Copy to:
Robert A. Profusek, Esq.
Jones, Day, Reavis & Pogue
599 Lexington Avenue
32nd Floor
New York, New York 10022
Telephone: (212) 326-3939
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after the effective date of the Registration Statement, as
determined by market conditions and other factors.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, 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 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. [X]
__________________________
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
========================================================================================================================
Title of each class of securities to Amount to be Proposed Proposed maximum Amount of
be registered registered(1) maximum offering aggregate registration
price per offering fee
unit(1)(2) price(1)(2)(3)(4)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities(5) } } } }
Common Stock, par value $.01 per share(5)(6) } } } }
Preferred Stock, par value $.01 per share(5) } } } }
Warrants } } } }
} } } }
Total $1,000,000,000 $1,000,000,000 $1,000,000,000 $344,827
========================================================================================================================
</TABLE>
(1) In United States dollars or the equivalent thereof in any
other currency, currency unit or units, or composite currency
or currencies. Such amount represents the aggregate offering
price of the securities registered hereunder and the exercise
price of any securities issuable upon exercise of Warrants.
If any securities are issued at an original issue discount,
then such greater amount as shall result in an aggregate
initial offering price of $1,000,000,000.
(2) Not specified as to each class of securities to be registered,
pursuant to General Instruction II.D. of Form S-3.
(3) Estimated for the sole purpose of computing the registration fee
pursuant to Rule 457(o) under the Securities Act of 1933. The proposed
maximum offering price per unit will be determined from time to time by
the Registrant in connection with the issuance by the Registrant of the
securities registered hereunder.
(4) The number of shares of Common Stock registered hereunder is limited to
that which is permissible under Rule 415(a)(4) of the Securities Act of
1933.
(5) Also includes such indeterminate number of shares of Preferred Stock and
Common Stock as may be issued upon conversion of or exchange for any
Debt Securities or Preferred Stock that provide for conversion or
exchange into other securities.
(6) Includes rights to purchase Series A Junior Participating Preferred
Stock. Prior to the occurrence of certain events, purchase rights for
units of Series A Junior Participating Preferred Stock will not be
evidenced separately from the Common Stock.
__________________________
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
WILL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE> 3
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF ANY OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF
ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED DECEMBER 13, 1995
PROSPECTUS
$1,000,000,000
FEDERATED DEPARTMENT STORES, INC.
DEBT SECURITIES
COMMON STOCK
PREFERRED STOCK
WARRANTS
Federated Department Stores, Inc. (the "Company") may offer from time to
time, together or separately, (i) debt securities ("Debt Securities")
consisting of notes, debentures or other evidences of indebtedness in one or
more series, (ii) shares of its Common Stock, par value $.01 per share (the
"Common Stock"), (iii) shares of its Preferred Stock, par value $.01 per share
(the "Preferred Stock"), and (iv) warrants to purchase Debt Securities, Common
Stock or Preferred Stock, or any combination thereof, as may be designated by
the Company at the time of the offering (the "Warrants") in amounts, at prices
and on terms to be determined at the time of the offering. The Debt
Securities, Common Stock, Preferred Stock, and Warrants are collectively called
the "Securities".
The Securities may be offered in separate series or issuances at an
aggregate initial public offering price not to exceed $1,000,000,000 or, if
applicable, the equivalent thereof in other currencies, at prices and on terms
to be determined at the time or times of offering.
The specific terms of the Securities with respect to which this Prospectus
is being delivered are set forth in the accompanying Prospectus Supplement and
include, where applicable, (i) in the case of Debt Securities, the specific
designation, aggregate principal amount, purchase price, maturity, rate (or
method of calculation thereof) and time of payment of interest, if any, any
conversion or exchange provisions, any redemption provisions, any subordination
provisions, and any other specific terms of the Debt Securities offered hereby
not set forth herein under the caption "Description of Debt Securities" in this
Prospectus, and any listing thereof on a securities exchange; (ii) in the case
of Common Stock, the number of shares and any initial public offering price;
(iii) in the case of Preferred Stock, the number of shares, the specific title,
the aggregate amount, any dividend (including the method of calculating payment
of dividends), seniority, liquidation, redemption, voting and other rights, any
terms for any conversion or exchange into other Securities, any listing on a
securities exchange, the initial public offering price, and any other terms;
and (iv) in the case of Warrants, the designation and number, the exercise
price, any listing of the Warrants or the underlying Securities on a securities
exchange, and any other terms in connection with the offering, sale and
exercise of the Warrants.
The Company's Common Stock is listed on the New York Stock Exchange (the
"NYSE") under the trading symbol "FD." Any Common Stock sold pursuant to a
Prospectus Supplement will be listed on the NYSE, subject to official notice of
issuance.
Any statement contained in this Prospectus will be deemed to be modified or
superseded by any inconsistent statement contained in the accompanying
Prospectus Supplement.
SEE "RISK FACTORS" BEGINNING AT PAGE 3 HEREOF FOR A DESCRIPTION OF
CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN
THE SECURITIES.
____________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
____________________
<PAGE> 4
The Securities will be sold either through underwriters, dealers, or agents
or directly by the Company. The accompanying Prospectus Supplement sets forth
the names of any underwriters, dealers, or agents involved in the sale of the
Securities in respect of which this Prospectus is being delivered, the proposed
amounts, if any, to be purchased by underwriters, and the compensation, if any,
of such underwriters, dealers, or agents.
____________________
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
____________________
THE DATE OF THIS PROSPECTUS IS ________________, 1995.
<PAGE> 5
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES
DESCRIBED HEREIN OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY
SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IF
UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements, and other information with the
Securities and Exchange Commission (the "Commission"). Reports, proxy
statements, and other information filed by the Company can be inspected and
copied at the public reference facilities maintained by the Commission at Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the Commission's
Regional Offices located at 7 World Trade Center, New York, New York 10048 and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of such materials can be obtained at prescribed rates from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549 at prescribed rates. The Common Stock and certain other securities of
the Company are listed on the NYSE. Reports and other information concerning
the Company may also be inspected and copied at the offices of the NYSE, 20
Broad Street, New York, New York 10005.
The Company has filed a Registration Statement on Form S-3 (the
"Registration Statement") filed under the Securities Act of 1933, as amended
(the "Securities Act"). This Prospectus does not contain all information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information, reference is hereby made to the Registration Statement, which may
be inspected and copied at, or obtained from, the Commission or the NYSE in the
manner described above.
____________________
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended January
28, 1995 (File No. 1-3536) (the "1994 Form 10-K"), the Company's Quarterly
Reports on Form 10-Q for the fiscal quarters ended April 29, 1995 (the "First
Quarter Form 10-Q"), July 29, 1995 (the "Second Quarter Form 10-Q") and October
28, 1995 (the "Third Quarter Form 10-Q"), the Company's Current Reports on
Form 8-K dated September 21, 1995, September 22, 1995, September 26, 1995,
September 27, 1995, October 4, 1995, and October 11, 1995, and all reports and
other documents filed by the Company pursuant to Sections 13(a), 13(c), 14, and
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering of the Securities pursuant hereto are
incorporated herein by reference.
Any statement contained in a document all or a portion of which is
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified will not be deemed to
constitute a part of this Prospectus, except as so modified, and any statement
so superseded will not be deemed to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, upon the written or oral request of any such
person, a copy of any or all of the documents incorporated herein by reference,
other than exhibits to such documents (unless such exhibits are specifically
incorporated by reference into such documents). Requests should be directed to
Federated Department Stores, Inc., 7 West Seventh Street, Cincinnati, Ohio
45202, Attention: Investor Relations (telephone: (513) 579-7780).
-2-
<PAGE> 6
RISK FACTORS
The Securities are subject to a number of material risks, including those
enumerated below. Investors should carefully consider the risk factors
enumerated below together with all of the information set forth or incorporated
by reference in this Prospectus or the accompanying Prospectus Supplement in
determining whether to purchase any of the Securities.
BUSINESS FACTORS AND COMPETITIVE CONDITIONS
The retailing industry is and will continue to be intensely competitive.
The Company's stores will face increasing competition not only with other
department stores in the geographic areas in which they operate, but also with
numerous other types of retail outlets, including specialty stores, general
merchandise stores, off-price and discount stores, new and established forms of
home shopping (including mail order catalogs, television, and computer
services), and manufacturer outlets.
SEASONAL NATURE OF THE DEPARTMENT STORE BUSINESS
The department store business is seasonal in nature, with a high proportion
of sales and operating income generated in November and December. Working
capital requirements fluctuate during the year, increasing somewhat in
mid-Summer in anticipation of the Fall merchandising season and increasing
substantially prior to the Christmas season as significantly higher inventory
levels are necessary.
LEVERAGE; RESTRICTIVE COVENANTS
The Company's consolidated indebtedness is and will continue to be greater
than its shareholders' equity. As of October 28, 1995, the Company had a total
of $6,884.8 million of consolidated indebtedness. Certain of the debt
instruments to which the Company is a party contain a number of restrictive
covenants and events of default, including covenants limiting capital
expenditures, incurrence of debt, and sales of assets. In addition, under
certain of its debt instruments, the Company is required to achieve certain
financial ratios, some of which become more restrictive over time, and a
substantial portion of the Company's indebtedness is secured by the capital
stock or assets of various subsidiaries of the Company or has been incurred by
the Company's subsidiaries. Among other consequences, the leverage of the
Company and such restrictive covenants and other terms of the Company's debt
instruments could impair the Company's ability to obtain additional financing
in the future, to make acquisitions, and to take advantage of significant
business opportunities that may arise. In addition, the Company's leverage may
increase its vulnerability to adverse general economic and retailing industry
conditions and to increased competitive pressures.
DIVIDEND POLICIES; RESTRICTIONS ON PAYMENT OF DIVIDENDS
The Company does not anticipate that it will pay any dividends on the
Common Stock in the foreseeable future. The Company's bank credit agreement
includes covenants restricting the Company's ability to pay dividends or make
certain other distributions to stockholders. In connection with the offering
of any dividend-paying Preferred Stock hereby, the applicable Prospectus
Supplement will set forth the amount available for distribution as of the end
of the most recent fiscal period under the Company's bank credit agreement.
SECURITY INTERESTS
The capital stock of the Company's principal subsidiaries and substantially
all of the receivables and certain real estate of the Company and its
subsidiaries are subject to various security interests and liens securing
certain indebtedness of the Company and its subsidiaries. As of October 28,
1995, the Company and its subsidiaries had $5,308.5 million of secured
indebtedness. If a holder of a security interest becomes entitled to exercise
its rights as a secured party, it would have the right to foreclose upon and
sell or otherwise transfer the collateral subject to its security interest, and
the collateral would be correspondingly unavailable to the Company or the
subsidiary owning such collateral and to other creditors of the Company or such
subsidiary, except to the extent, if any, that the value of the affected
collateral exceeds the amount of the indebtedness in respect of which such
foreclosure rights are exercised.
-3-
<PAGE> 7
HOLDING COMPANY STRUCTURE
The Company is a holding company, substantially all of the operations of
which are conducted through subsidiaries. Consequently, the Company relies
principally on dividends or advances from its subsidiaries for the funds
necessary for, among other things, the payment of principal of and interest on
the Debt Securities and the other indebtedness of the Company. The ability of
such subsidiaries to pay dividends is subject to applicable state law and
certain other restrictions. Any right of the holders of the Debt Securities to
participate in the assets of any of the subsidiaries upon such subsidiary's
liquidation or recapitalization will be effectively subordinated to the claims
of such subsidiary's creditors and preferred stockholders (if any), except to
the extent that the Company is itself recognized as a creditor of such
subsidiary. In addition to their own indebtedness, certain of the Company's
subsidiaries have guaranteed the indebtedness of the Company under its bank
credit facility.
NONCOMPARABILITY OF HISTORICAL FINANCIAL INFORMATION; CONSOLIDATION OF
BUSINESSES
The Company acquired R.H. Macy & Co., Inc. ("Macy's") on December 19, 1994
and effected other acquisitions (and dispositions) during fiscal year 1994.
Under the purchase method of accounting, the assets, liabilities, and results
of operations associated with such acquisitions have been included in the
Company's financial position and results of operations since the respective
dates thereof. Accordingly, the financial position and results of operations
of the Company as of the end of and for fiscal year 1994 and subsequent dates
and periods are not directly comparable to the financial position and results
of operations of the Company as of and for prior dates and periods. Similar
effects result from the Company's recent acquisition of Broadway Stores, Inc.
("Broadway"). For accounting purposes, the assets, liabilities, and results of
operations associated with the Broadway acquisition are included in the
Company's financial position and results of operations following July 29, 1995.
Accordingly, the financial position and results of operations for the Company
for dates and periods subsequent to July 29, 1995 are not directly comparable
to the financial position and results of operations of the Company on and prior
to that date.
For the 39 weeks ended Ocrober 28, 1995, the Company incurred $211.5
million of non-recurring charges in connection with the consolidation of the
Macy's and Broadway's businesses with the Company's other businesses and other
divisional consolidations. The Company anticipates that it will incur
additional non-recurring charges in connection with the consolidation of
Broadway's business with the Company's other businesses, as well as the ongoing
consolidations of the Macy's business and the Company's other businesses. In
addition, the Company anticipates that a number of Broadway's stores will be
sold or otherwise disposed of. The Company has entered into a definitive
agreement to sell nine stores, has identified ten additional stores to be sold,
and has yet to make a determination with respect to certain other stores.
CERTAIN CLAIMS AGAINST THE MACY'S DEBTORS
Certain claims or portions thereof (the "Cash Payment Claims") against
Macy's and certain of its subsidiaries (collectively, the "Macy's Debtors")
which, to the extent allowed by the bankruptcy court having continuing
jurisdiction over the Macy's Debtors, will be paid in cash pursuant to the plan
of reorganization of the Macy's Debtors were disputed by the Company as of the
date of this Prospectus. The aggregate amount of disputed Cash Payment Claims
ultimately allowed may be more or less than the Company's estimate of the
aggregate allowed amount thereof. As of December 5, 1995, the aggregate face
amount of disputed Cash Payment Claims was $362.5 million, while the estimated
allowed amount thereof was $242.5 million. Although there can be no assurance
with respect thereto, the Company believes that the actual allowed amount of
disputed Cash Payment Claims will not exceed the estimated allowed amount
thereof.
MARKET RISK; CERTAIN INVESTMENT LIMITATIONS
The Common Stock is listed for trading on the NYSE. However, the prices at
which shares of Common Stock trade may depend upon many factors, including
prevailing interest rates, markets for similar securities, industry conditions,
and the performance of, and investor expectations for, the Company. No
assurance can be given that a holder of shares of Common Stock will be able to
sell such shares at any particular price.
Certain institutional investors may invest only in dividend-paying equity
securities or may operate under other restrictions that may prohibit or limit
their ability to invest in Common Stock.
-4-
<PAGE> 8
ABSENCE OF PUBLIC MARKET FOR THE DEBT SECURITIES AND PREFERRED STOCK
All Debt Securities and Preferred Stock will be a new issue of securities
with no established trading market. Any underwriters to whom Debt Securities
or Preferred Stock are sold by the Company for public offering and sale may
make a market in such Debt Securities or Preferred Stock, but such underwriters
will not be obligated to do so and may discontinue any market making at any
time without notice. No assurance can be given as to the liquidity of the
secondary market for any Debt Securities or Preferred Stock.
CERTAIN TAXATION MATTERS
The Company is subject to audits by taxing authorities with respect to
periods both before and after the Macy's acquisition. As of the date of this
Prospectus, the Company was a party to certain disputes with the Internal
Revenue Service (the "IRS") in which the IRS was seeking to disallow certain
deductions claimed by, and certain loss carryforwards utilized by, Federated
and its predecessors. Although there can be no assurance with respect thereto,
the Company does not expect the ultimate resolution of such disputes to have a
material adverse effect on the Company's financial position or results of
operations.
CERTAIN PROVISIONS OF THE COMPANY'S CERTIFICATE OF INCORPORATION, BY-LAWS, AND
OTHER AGREEMENTS
The Company's certificate of incorporation and by-laws and certain other
agreements to which the Company is a party contain provisions that may have the
effect of delaying, deferring, or preventing a change in control of the
Company. In addition, the Company's certificate of incorporation authorizes
the issuance of up to 500.0 million shares of Common Stock and 125.0 million
shares of Preferred Stock. The Board will have the power to determine the
price and terms under which any additional capital stock may be issued and to
fix the terms of such Preferred Stock, and existing stockholders of the Company
will not have preemptive rights with respect thereto.
THE COMPANY
The Company is one of the leading operators of full-line department stores
in the United States, with 441 department stores in 34 states as of the date of
this Prospectus. As of the date of this Prospectus, the Company also operates
157 specialty and clearance stores and a mail order catalog business. The
Company's department stores sell a wide range of merchandise, including men's,
women's and children's apparel and accessories, cosmetics, home furnishings,
and other consumer goods, and are diversified by size of store, merchandising
character, and character of community served. The Company's department stores
are located at urban or suburban sites, principally in densely populated areas
across the United States. The Company has announced that it intends to close
all of its six remaining Macy's close-out stores by the end of fiscal 1995 and
that it intends to explore the possibility of selling the specialty store
operations that were acquired in the Company's acquisition of Macy's in
December 1994. In addition, the Company anticipates that a number of the
stores acquired in its recent acquisition of Broadway will be disposed of and
that Broadway's retained department stores will be converted into other
nameplates of the Company commencing in 1996. The Company has entered into a
definitive agreement to sell nine stores, has identified ten additional stores
to be sold, and has yet to make a determination with respect to certain other
stores.
The Company believes that the department store business will continue to
consolidate. Accordingly, the Company intends from time to time to consider
actions to increase efficiency and provide greater value to customers and to
consider the possible acquisition of department store assets and companies.
The Company's principal executive offices are located at 151 West 34th
Street, New York, New York 10001 and 7 West Seventh Street, Cincinnati, Ohio
45202. The Company's telephone numbers at such offices are (212) 695-4400 and
(513) 579-7000, respectively.
-5-
<PAGE> 9
USE OF PROCEEDS
The principal reason for this offering is to make funds available for
general corporate purposes, which may include the repayment of indebtedness
outstanding from time to time, acquisitions, new store construction, store
expansions, and further investments in technology. Other reasons, if any, for
this offering are set forth in the accompanying Prospectus Supplement.
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges for each of the periods set forth
below has been computed on a consolidated basis and should be read in
conjunction with the Company's Consolidated Financial Statements (including the
notes thereto) set forth in the 1994 Form 10-K and the Third Quarter Form 10-Q.
As a result of the Company's emergence from reorganization proceedings and its
adoption of fresh-start reporting as of February 1, 1992, the Company's
financial information for periods ending after February 1, 1992 is generally
not comparable to financial information for periods ending on or before
February 1, 1992 and is separated by a black line. As a result of the
Company's acquisition of Macy's and other transactions, the Company's financial
position and results of operations as of and for the year ended January 28,
1995 and subsequent dates and periods are not directly comparable to its
financial position and results of operations as of and for prior dates and
periods. See "Risk Factors -- Certain Effects of Acquisitions."
<TABLE>
<CAPTION>
Period Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year
Ended Ended Ended Ended Ended Ended
October 28, January 28, January 29, January 30, February 1, February 2,
1995 1995 1994 1993 1992 1991
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Consolidated
ratio of
earnings to
fixed charges
(unaudited) (a) ___ 1.99x 2.33x 1.72x ___ ___
Consolidated
deficiency of
earnings to
fixed charges
(in millions)
(unaudited)(a) $214.3 ___ ___ ___ $1,850.1(b) $548.8(c)
</TABLE>
_____________________________
(a) For purposes of computing the ratio (or deficiency) of earnings to
fixed charges, earnings consist of income before income taxes and
extraordinary items plus fixed charges (excluding capitalized
interest). Fixed charges represent interest incurred, amortization of
debt expense, and that portion of rental expense on operating leases
deemed to be the equivalent of interest.
(b) Excludes interest on unsecured prepetition indebtedness of $301.6
million and dividends on preferred stock of $47.4 million.
(c) Excludes interest on unsecured prepetition indebtedness of $291.0
million and dividends on preferred stock of $47.4 million.
-6-
<PAGE> 10
DESCRIPTION OF DEBT SECURITIES
GENERAL
The Debt Securities will be issued under an Indenture, dated as of December
15, 1994 (the "Indenture"), which is incorporated by reference as an exhibit to
the Registration Statement, between the Company and State Street Bank and Trust
Company, as Trustee (the "Trustee"). The statements under this caption are
brief summaries of the material provisions of the Indenture, do not purport to
be complete, and are subject to, and are qualified in their entirety by
reference to, all of the provisions of the Indenture. Except as otherwise
defined herein, capitalized terms used herein have the meanings given to them
in the Indenture.
The Indenture does not limit the aggregate amount of Debt Securities which
may be issued thereunder. The Debt Securities may be issued from time to time
in one or more series. Reference is made to the accompanying Prospectus
Supplement for the following terms and other information with respect to the
Debt Securities being offered hereby: (i) the title of such Debt Securities;
(ii) any limit on the aggregate principal amount of such Debt Securities; (iii)
the persons to whom any interest on such Debt Securities will be payable, if
other than the registered holders thereof on the Regular Record Date therefor;
(iv) the date or dates (or manner of determining the same) on which the
principal of such Debt Securities will be payable; (v) the rate or rates (or
manner of determining the same) at which such Debt Securities will bear
interest, if any, and the date or dates from which such interest will accrue;
(vi) the dates (or manner of determining the same) on which such interest will
be payable and the Regular Record Dates for such Interest Payment Dates; (vii)
the place or places where the principal of and any premium and interest on such
Debt Securities will be payable; (viii) the period or periods, if any, within
which, and the price or prices at which, such Debt Securities may be redeemed,
in whole or in part, at the option of the Company; (ix) any mandatory or
optional sinking fund or analogous provisions; (x) the denominations in which
any Debt Securities will be issuable if other than denominations of $1,000 and
any integral multiple thereof; (xi) the currency or currencies or currency
units, if other than currency of the United States of America, in which payment
of the principal of and any premium or interest on such Debt Securities will be
payable, and the terms and conditions of any elections that may be made
available with respect thereto; (xii) any index or formula used to determine
the amount of payments of principal of and any premium or interest on such Debt
Securities; (xiii) whether the Debt Securities are to be issued in whole or in
part in the form of one or more global securities ("Global Securities"), and,
if so, the identity of the depositary, if any, for such Global Security or
Securities; (xiv) the terms and conditions, if any, pursuant to which such Debt
Securities are convertible into or exchangeable for Common Stock or other
securities; (xv) the applicability of the provisions described in "--
Defeasance"; (xvi) any subordination provisions applicable to such Debt
Securities; and (xvii) any other terms of the Debt Securities.
Debt Securities may be issued at a discount from their stated principal
amount. Certain federal income tax considerations and other special
considerations applicable to any Debt Security issued with original issue
discount (an "Original Issue Discount Security") may be described in an
applicable Prospectus Supplement.
If the purchase price of any of the Debt Securities is denominated in a
foreign currency or currencies or a foreign currency unit or units or if the
principal of and any premium and interest on any series of Debt Securities is
payable in a foreign currency or currencies or a foreign currency unit or
units, the restrictions, elections, general tax considerations, specific terms,
and other information with respect to such issue of Debt Securities and such
foreign currency or currencies or foreign currency unit or units will be set
forth in an applicable Prospectus Supplement.
Unless otherwise indicated in an applicable Prospectus Supplement, (i) the
Debt Securities will be issued only in fully registered form in denominations
of $1,000 or integral multiples thereof and (ii) payment of principal, premium
(if any), and interest on the Debt Securities will be payable, and the
exchange, conversion, and transfer of Debt Securities will be registerable, at
the office or agency of the Company maintained for such purposes and at any
other office or agency maintained for such purpose. No service charge will be
made for any registration of transfer or exchange of the Debt Securities, but
the Company may require payment of a sum sufficient to cover any tax or other
governmental charge imposed in connection therewith.
-7-
<PAGE> 11
BOOK-ENTRY DEBT SECURITIES
The Debt Securities of a series may be issued in whole or in part in the
form of one or more Global Securities that will be deposited with, or on behalf
of, a depositary (a "Depositary") or its nominee identified in an applicable
Prospectus Supplement. In such a case, one or more Global Securities will be
issued in a denomination or aggregate denominations equal to the portion of the
aggregate principal amount of Debt Securities of the series to be represented
by such Global Security or Securities. Unless and until it is exchanged in
whole or in part for Debt Securities in registered form, a Global Security may
not be registered for transfer or exchange except as a whole by the Depositary
for such Global Security to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any nominee to a successor Depositary or a nominee of such
successor Depositary and except in any other circumstances described in an
applicable Prospectus Supplement.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in an applicable Prospectus Supplement. The Company expects
that the following provisions will apply to depositary arrangements.
Unless otherwise specified in an applicable Prospectus Supplement, Debt
Securities which are to be represented by a Global Security to be deposited
with or on behalf of a Depositary will be represented by a Global Security
registered in the name of such depositary or its nominee. Upon the issuance of
such Global Security, and the deposit of such Global Security with or on behalf
of the Depositary for such Global Security, the Depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts
of the Debt Securities represented by such Global Security to the accounts of
institutions that have accounts with such depositary or its nominee
("Participants"). The accounts to be credited will be designated by the
underwriters or agents of such Debt Securities or by the Company, if such Debt
Securities are offered and sold directly by the Company. Ownership of
beneficial interests in such Global Securities will be limited to Participants
or Persons that may hold interests through Participants. Ownership of
beneficial interests by Participants in such Global Security will be shown on,
and the transfer of that ownership interest will be effected only through,
records maintained by the Depositary or its nominee for such Global Security.
Ownership of beneficial interests in such Global Security by Persons that hold
through Participants will be shown on, and the transfer of that ownership
interest within such Participant will be effected only through, records
maintained by such Participants. The laws of some jurisdictions require that
certain purchasers of securities take physical delivery of such securities in
definitive form. Such laws may impair the ability to transfer beneficial
interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or Holder of the Debt
Securities represented by such Global Security for all purposes under the
Indenture. Unless otherwise specified in an applicable Prospectus Supplement,
owners of beneficial interests in such Global Securities will not be entitled
to have Debt Securities of the series represented by such Global Security
registered in their names, will not receive or be entitled to receive physical
delivery of Debt Securities of such series in certificated form, and will not
be considered the owners or Holders thereof for any purpose under the
Indenture. Accordingly, each Person owning a beneficial interest in such
Global Security must rely on the procedures of the Depositary and, if such
Person is not a Participant, on the procedures of the Participant through which
such Person owns its interest, to exercise any rights of a Holder under the
Indenture. The Company understands that, under existing industry practices, if
the Company requests any action of Holders or an owner of a beneficial interest
in such Global Security desires to give any notice or take any action a Holder
is entitled to give or take under Indenture, the Depositary would authorize the
Participants to give such notice or take such action, and Participants would
authorize beneficial owners owning through such Participants to give such
notice or take such action or would otherwise act upon the instructions of
beneficial owners owning through them.
Principal of and any premium and interest on a Global Security will be
payable in the manner described in an applicable Prospectus Supplement.
Payment of principal of, and any premium or interest on, Debt Securities
registered in the name of or held by a Depository or its nominee will be made
to the Depository or its nominee, as the case may be, as the registered owner
or the holder of the Global Security representing such Debt Securities. None
of the Company, the Trustee, any Paying Agent, or the Registrar for such Debt
Securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in a
-8-
<PAGE> 12
Global Security for such Debt Securities or for maintaining, supervising, or
reviewing any records relating to such beneficial ownership interests.
CERTAIN COVENANTS
Maintenance of Office or Agency. The Company will be required to maintain
an office or agency in each place of payment for each series of Debt Securities
for notice and demand purposes and for the purposes of presenting or
surrendering Debt Securities for payment, registration of transfer, or
exchange.
Paying Agents, Etc. If the Company acts as its own paying agent with
respect to any series of Debt Securities , on or before each due date of the
principal of, or interest on any of the Debt Securities of that series, it will
be required to segregate and hold in trust for the benefit of the persons
entitled thereto a sum sufficient to pay such amount due and to notify the
Trustee promptly of its action or failure so to act. If the Company has one or
more paying agents for any series of Debt Securities, prior to each due date of
the principal of or interest on any Debt Securities of that series, it will
deposit with a paying agent a sum sufficient to pay such amount, and the
Company will promptly notify the Trustee of its action or failure so to act
(unless such paying agent is the Trustee). All moneys paid by the Company to a
paying agent for the payment of principal of and interest on any Debt
Securities that remain unclaimed for two years after such principal or interest
has become due and payable may be repaid to the Company, and thereafter the
holder of such Debt Securities may look only to the Company for payment
thereof.
Payment of Taxes and Other Claims. The Company will be required to pay and
discharge, before the same become delinquent, (i) all taxes, assessments, and
governmental charges levied or imposed upon the Company or any Subsidiary of
the Company or their properties and (ii) all claims that if unpaid would result
in a lien on their property and have a material adverse effect on the business,
assets, financial condition, or results of operations of the Company and its
Subsidiaries, taken as a whole (a "Material Adverse Effect"), unless the same
is being contested by proper proceedings.
Maintenance of Properties. The Company will be required to cause all
properties used in the business of the Company or any Subsidiary of the Company
to be maintained and kept in good condition, repair, and working order, except
to the extent that the failure to do so would not have a Material Adverse
Effect.
Existence. The Company will be required to, and also will be required to
cause its Subsidiaries to, preserve and keep in full force their existence,
charter rights, statutory rights, and franchises, except to the extent that
failure to do so would not have a Material Adverse Effect.
Compliance with Laws. The Company will be required to and to cause its
Subsidiaries to comply with all applicable laws to the extent the failure to do
so would have a Material Adverse Effect.
Restrictive Covenants. Any restrictive covenants applicable to any series
of Debt Securities will be described in an applicable Prospectus Supplement.
EVENTS OF DEFAULT
The following are Events of Default under the Indenture with respect to
Debt Securities of any series: (i) default in the payment of the principal of
(or premium, if any, on) any Debt Security of that series when it becomes due
and payable; (ii) default in the payment of any interest on any Debt Security
of that series when it becomes due and payable, and continuance of such default
for a period of 30 calendar days; (iii) default in the making of any sinking
fund payment as and when due by the terms of any Debt Security of that series;
(iv) default in the performance, or breach, of any other covenant or warranty
of the Company in the Indenture (other than a covenant included in the
Indenture solely for the benefit of a series of Debt Securities other than that
series) and continuance of such default for a period of 60 calendar days after
written notice thereof has been given to the Company as provided in the
Indenture; (v) any nonpayment at maturity or other default (beyond any
applicable grace period) under any agreement or instrument relating to any
other indebtedness of the Company the principal amount of which is not less
than $100 million, which default results in such indebtedness becoming due
prior to its stated maturity or occurs at the final maturity thereof; (vi)
certain events of bankruptcy, insolvency, or reorganization involving the
Company; and (vii) any other Event of Default provided with respect to Debt
Securities of that series. Pursuant to the Trust Indenture Act, the Trustee
is required, within 90 calendar days after the occurrence of a default in
respect of any series of Debt
-9-
<PAGE> 13
Securities, to give to the Holders of the Debt Securities of such series notice
of all such uncured defaults known to it (except that, in the case of a default
in the performance of any covenant of the character contemplated in clause (iv)
of the preceding sentence, no such notice to Holders of the Debt Securities of
such Series will be given until at least 30 calendar days after the occurrence
thereof), except that, other than in the case of a default of the character
contemplated in clause (i), (ii), or (iii) of the preceding sentence, the
Trustee may withhold such notice if and so long as it in good faith determines
that the withholding of such notice is in the interests of the Holders of the
Debt Securities of such series.
If an Event of Default with respect to Debt Securities occurs and is
continuing, either the Trustee or the Holders of at least 25% in principal
amount of the Debt Securities of that series by notice as provided in the
Indenture may declare the principal amount (or, if the Debt Securities of that
series are Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms of that series) of all Debt Securities
of that series to be due and payable immediately. However, at any time after a
declaration of acceleration with respect to Debt Securities of any series has
been made, but before a judgment or decree based on such acceleration has been
obtained, the Holders of a majority in principal amount of the Debt Securities
of that series may, under certain circumstances, rescind and annul such
acceleration. See "-- Modification and Waiver" below. If an Event of Default
under clause (vi) of the immediately preceding paragraph occurs, then the
principal of, premium on, if any, and accrued interest on the Debt Securities
of that series will become immediately due and payable without any declaration
or other act on the part of the Trustee of any holder of the Debt Securities of
that series.
The Indenture provides that, subject to the duty of the Trustee thereunder
during an Event of Default to act with the required standard of care, the
Trustee will be 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
such Holders shall have offered to the Trustee reasonable security or
indemnity. Subject to certain provisions, including those requiring security
or indemnification of the Trustee, the Holders of a majority in principal
amount of the Debt Securities of any series will 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 Debt Securities of that series.
No Holder of a Debt Security of any series will have any right to institute
any proceeding with respect to the Indenture or for any remedy thereunder
unless such Holder shall have previously given to the Trustee written notice of
a continuing Event of Default and unless the Holders of at least 25% in
aggregate principal amount of the outstanding Debt Securities of the same
series have also made written request, and offered reasonable indemnity, to the
Trustee to institute such proceeding as trustee, and the Trustee has received
from the Holders of a majority in aggregate principal amount of the outstanding
Debt Securities of the same series a direction inconsistent with such request
and has failed to institute such proceeding within 60 calendar days. However,
such limitations do not apply to a suit instituted by a Holder of a Debt
Security for enforcement of payment of the principal of and interest on such
Debt Security on or after the respective due dates expressed in such Debt
Security.
The Company is required to furnish to the Trustee annually a statement as
to the performance by the Company of its obligations under the Indenture and as
to any default in such performance.
Any additional Events of Default with respect to any series of Debt
Securities, and any variations from the foregoing Events of Default applicable
to any series of Debt Securities, will be described in an applicable Prospectus
Supplement.
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Debt Securities of each series affected
thereby, except that no such modification or amendment may, without the consent
of the Holder of each Debt Security affected thereby, (i) change the Stated
Maturity of, or any installment of principal of, or interest on, any Debt
Security; (ii) reduce the principal amount of, the rate of interest on, or the
premium, if any, payable upon the redemption of, any Debt Security; (iii)
reduce the amount of principal of an Original Issue Discount Security payable
upon acceleration of the Maturity thereof; (iv) change the place or currency of
payment of principal of, or premium, if any, or interest on any Debt Security;
(v) impair the right to institute suit for the enforcement of any payment on or
with respect to any Debt Security on or after the Stated Maturity or Prepayment
Date thereof; or (vi) reduce the percentage in
-10-
<PAGE> 14
principal amount of Debt Securities of any series, the consent of the Holders
of which is required for modification or amendment of the applicable Indenture
or for waiver of compliance with certain provisions of the Indenture or for
waiver of certain defaults.
The Holders of at least a majority in aggregate principal amount of the
Debt Securities of any series may on behalf of the Holders of all Debt
Securities of that series waive, insofar as that series is concerned,
compliance by the Company with certain covenants of the Indenture. The Holders
of not less than a majority in principal amount of the Debt Securities of any
series may, on behalf of the Holders of all Debt Securities of that series,
waive any past default under the Indenture with respect to that series, except
a default in the payment of the principal of, or premium, if any, or interest
on, any Debt Security of that series or in respect of a provision which under
the Indenture cannot be modified or amended without the consent of the Holder
of each Debt Security of that series affected thereby.
DEFEASANCE
Unless otherwise specified in a Prospectus Supplement applicable to a
particular series of Debt Securities, the Company, at its option, (i) will be
deemed to have been discharged from its obligations with respect to the Debt
Securities of such series (except for certain obligations, including
obligations to register the transfer or exchange of Debt Securities of such
series, to replace destroyed, stolen, lost, or mutilated Debt Securities of
such series, and to maintain an office or agency in respect of the Debt
Securities and hold moneys for payment in trust) or (ii) will be released from
its obligations to comply with the covenants that are under "Certain Covenants"
above with respect to the Debt Securities of such series, and the occurrence of
an event described in clause (iv) under "Events of Default" above with respect
to any defeased covenant and clauses (iii), (v), and (vii) of the "Events of
Default" above will no longer be an Event of Default if, in either case, the
Company irrevocably deposits with the Trustee, in trust, money or direct
obligations of the United States of America for the payment of which the full
faith and credit of the United States of America is pledged or obligations of
an agency or instrumentality of the United States of America the payment of
which is unconditionally guaranteed as a full faith and credit obligation by
the United States of America, which, in either case, are not callable at the
issuer's option ("U.S. Government Obligations") or certain depositary receipts
therefor that through the payment of interest thereon and principal thereof in
accordance with their terms will provide money in an amount sufficient to pay
all the principal of (and premium, if any) and any interest on the Debt
Securities of such series on the dates such payments are due in accordance with
the terms of such Debt Securities. Such defeasance may be effected only if,
among other things, (a) no Event of Default or event which with the giving of
notice or lapse or time, or both, would become an Event of Default under the
Indenture shall have occurred and be continuing on the date of such deposit,
(b) no Event of Default described under clause (vi) under "-- Events of
Default" above or event that with the giving of notice or lapse of time, or
both, would become an Event of Default described under such clause (vi) shall
have occurred and be continuing at any time on or prior to the 90th calendar
day following such date of deposit, (c) in the event of defeasance under clause
(i) above, the Company has delivered an Opinion of Counsel, stating that (1)
the Company has received from, or there has been published by, the IRS a ruling
or (2) since the date of the Indenture there has been a change in applicable
federal law, in either case to the effect that, among other things, the holders
of the Debt Securities of such series will not recognize gain or loss for
United States federal income tax purposes as a result of such deposit or
defeasance and will be subject to United States federal income tax in the same
manner as if such defeasance had not occurred, and (d) in the event of
defeasance under clause (ii) above, the Company has delivered an Opinion of
Counsel to the effect that, among other things, the Holders of the Debt
Securities of such series will not recognize gain or loss for United States
federal income tax purposes as a result of such deposit or defeasance and will
be subject to United States federal income tax in the same manner as if such
defeasance had not occurred. In the event the Company fails to comply with its
remaining obligations under the applicable Indenture after a defeasance of such
Indenture with respect to the Debt Securities of any series as described under
clause (ii) above and the Debt Securities of such series are declared due and
payable because of the occurrence of any undefeased Event of Default, the
amount of money and U.S. Government Obligations on deposit with the Trustee may
be insufficient to pay amounts due on the Debt Securities of such series at the
time of the acceleration resulting from such Event of Default. However, the
Company will remain liable in respect of such payments.
-11-
<PAGE> 15
SATISFACTION AND DISCHARGE
The Company, at its option, may satisfy and discharge the Indenture (except
for certain obligations of the Company and the Trustee, including, among
others, the obligations to apply money held in trust) when (i) either (a) all
Debt Securities previously authenticated and delivered (other than (1) Debt
Securities that were destroyed, lost, or stolen and that have been replaced or
paid and (2) Debt Securities for the payment of which money has been deposited
in trust or segregated and held in trust by the Company and thereafter repaid
to the Company or discharged from such trust) have been delivered to the
Trustee for cancellation or (b) all such Debt Securities not theretofore
delivered to the Trustee for cancellation (1) have become due and payable, (2)
will become due and payable at their Stated Maturity within one year, or (3)
are to be called for redemption within one year under arrangements satisfactory
to the Trustee for the giving of notice of redemption by the Trustee in the
name and at the expense of the Company, and the Company has deposited or caused
to be deposited with the Trustee as trust funds in trust for such purpose an
amount sufficient to pay and discharge the entire indebtedness on such Debt
Securities not previously delivered to the Trustee for cancellation, for
principal and any premium and interest to the date of such deposit (in the case
of Debt Securities which have become due and payable) or to the stated maturity
or redemption date, as the case may be, (ii) the Company has paid or caused to
be paid all other sums payable under the Indenture by the Company, and (iii)
the Company has delivered to the Trustee an Officer's Certificate and an
Opinion of Counsel, each to the effect that all conditions precedent relating
to the satisfaction and discharge of the Indenture have been satisfied.
LIMITATIONS ON MERGER AND CERTAIN OTHER TRANSACTIONS
Prior to the satisfaction and discharge of the Indenture, the Company may
not consolidate with or merge with or into any other person, or transfer all or
substantially all of its properties and assets to another person unless (i)
either (a) the Company is the continuing or surviving person in such a
consolidation or merger or (b) the person (if other than the Company) formed by
such consolidation or into which the Company is merged or to which all or
substantially all of the properties and assets of the Company are transferred
(the Company or such other person being referred to as the "Surviving Person")
is a corporation organized and validly existing under the laws of the United
States, any state thereof, or the District of Columbia, and expressly assumes,
by an indenture supplement, all the obligations of the Company under the Debt
Securities and the Indenture, (ii) immediately after the transaction and the
incurrence or anticipated incurrence of any indebtedness to be incurred in
connection therewith, no Event of Default exists, and (iii) an officer's
certificate is delivered to the Trustee to the effect that the conditions set
forth in the preceding clauses (i) and (ii) have been satisfied and an opinion
of counsel has been delivered to the Trustee to the effect that the conditions
set forth in the preceding clause (i) have been satisfied. The Surviving
Person will succeed to and be substituted for the Company with the same effect
as if it has been named in the Indenture as a party thereto, and thereafter the
predecessor corporation will be relieved of all obligations and covenants under
the Indenture and the Debt Securities.
GOVERNING LAW
The Indentures and the Debt Securities will be governed by, and construed
in accordance with, the laws of the State of New York.
REGARDING THE TRUSTEE
The Indenture contains certain limitations on the right of the Trustee,
should it become a creditor of the Company within three months of, or
subsequent to, a default by the Company to make payment in full of principal of
or interest on any series of Debt Securities when and as the same becomes due
and payable, to obtain payment of claims, or to realize for its own account on
property received in respect of any such claim as security or otherwise, unless
and until such default is cured. However, the Trustee's rights as a creditor
of the Company will not be limited if the creditor relationship arises from,
among other things, the ownership or acquisition of securities issued under any
indenture or having a maturity of one year or more at the time of acquisition
by the Trustee; certain advances authorized by a receivership or bankruptcy
court of competent jurisdiction or by the Indenture; disbursements made in the
ordinary course of business in its capacity as indenture trustee, transfer
agent, registrar, custodian, or paying agent or in any other similar capacity;
indebtedness created as a result of goods or securities sold in a cash
transaction or services rendered or premises rented; or the acquisition,
ownership, acceptance, or negotiation of certain drafts, bills of exchange,
acceptances, or other obligations. The Indenture does not prohibit the Trustee
from serving as trustee under
-12-
<PAGE> 16
any other indenture to which the Company may be a party from time to time or
from engaging in other transactions with the Company. If the Trustee acquires
any conflicting interest and there is an Event of Default with respect to any
series of Debt Securities, it must eliminate such conflict or resign.
DESCRIPTION OF CAPITAL STOCK
AUTHORIZED CAPITAL STOCK
The Company's Certificate of Incorporation provides that the authorized
capital stock of the Company consists of 500 million shares of Common Stock and
125 million shares of Preferred Stock.
COMMON STOCK
The holders of the Common Stock are entitled to one vote for each share
held of record on all matters submitted to a vote of stockholders. Subject to
preferential rights that may be applicable to any Preferred Stock, holders of
Common Stock are entitled to receive ratably such dividends as may be declared
by the Board of Directors of the Company out of funds legally available
therefor. In the event of a liquidation, dissolution, or winding up of the
Company, holders of Common Stock will be entitled to share ratably in all
assets remaining after payment of liabilities and the liquidation preference of
any Preferred Stock. Holders of Common Stock have no preemptive rights and
have no rights to convert their Common Stock into any other securities, and
there are no redemption provisions with respect to such shares. The Common
Stock is listed on the NYSE. The transfer agent and registrar for the Common
Stock is The Bank of New York.
PREFERRED STOCK
The Board of Directors of the Company has the authority to issue 125
million shares of Preferred Stock in one or more series and to fix the
designations, relative powers, preferences, limitations, and restrictions of
all shares of each such series, including without limitation dividend rates,
conversion rights, voting rights, redemption and sinking fund provisions,
liquidation preferences, and the number of shares constituting each such
series, without any further vote or action by the stockholders. The issuance
of the Preferred Stock could decrease the amount of earnings and assets
available for distribution to holders of Common Stock or adversely affect the
rights and powers, including voting rights, of the holders of Stock. The
issuance of the Preferred Stock could have the effect of delaying, deferring,
or preventing a change in control of the Company without further action by the
stockholders.
The Board of Directors of the Company has not taken any action to designate
or issue any series of Preferred Stock, other than the Series A Junior
Participating Preferred Stock described below. The terms of any Preferred
Stock offered and the applicable Certificate of Designation, as well as the
transfer agent and registrar therefor, will be set forth in the applicable
Prospectus Supplement.
PREFERRED SHARE PURCHASE RIGHTS
Each outstanding share of Common Stock issued is accompanied by one right
(a "Right") issued pursuant to a share purchase rights agreement between the
Company and The Bank of New York, as Rights Agent (the "Share Purchase Rights
Agreement"). Each Right entitles the registered holder thereof to purchase
from the Company one one-hundredth of a share of Series A Junior Participating
Preferred Stock, par value $0.01 per share (the "Series A Preferred Shares"),
of the Company at a price (the "Purchase Price") of $62.50 per one
one-hundredth of a Series A Preferred Share, subject to adjustment.
Until the earliest to occur of the following dates (the earliest of such
dates being hereinafter called the "Rights Distribution Date"), the Rights will
be evidenced by the certificates evidencing shares of Common Stock: (i) the
close of business on the tenth business day (or such later date as may be
specified by the Board of Directors of the Company) following the first date of
public announcement by the Company that a person (other than the Company or a
subsidiary or employee benefit or stock ownership plan of the Company),
together with its affiliates and associates, has acquired, or obtained the
right to acquire, beneficial ownership of 20% or more of the outstanding Common
Stock (any such person being hereinafter called an "Acquiring Person"), (ii)
the close of business on the tenth business day
-13-
<PAGE> 17
(or such later date as may be specified by the Board of Directors of the
Company) following the commencement of a tender offer or exchange offer by a
person (other than the Company or a subsidiary or employee benefit or stock
ownership plan of the Company), the consummation of which would result in
beneficial ownership by such person of 20% or more of the outstanding Common
Stock, and (iii) the close of business on the tenth business day following the
first date of public announcement by the Company that a Flip-in Event or a
Flip-over Event (as such terms are hereinafter defined) has occurred.
The Share Purchase Rights Agreement provides that, until the Rights
Distribution Date, the Rights may be transferred with and only with the Common
Stock. Until the Rights Distribution Date (or earlier redemption or expiration
of the Rights), any certificate evidencing shares of Common Stock issued upon
transfer or new issuance of Common Stock will contain a notation incorporating
the Share Purchase Rights Agreement by reference. Until the Rights
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates evidencing Common Stock will also
constitute the transfer of the Rights associated with such certificates. As
soon as practicable following the Rights Distribution Date, separate
certificates evidencing the Rights ("Rights Certificates") will be mailed to
holders of record of Common Stock as of the close of business on the Rights
Distribution Date and such separate Rights Certificates alone will evidence the
Rights. No Right is exercisable at any time prior to the Rights Distribution
Date. The Rights will expire on December 19, 2004 (the "Final Expiration
Date") unless earlier redeemed or exchanged by the Company as described below.
Until a Right is exercised, the holder thereof, as such, will have no rights as
a stockholder of the Company, including without limitation the right to vote or
to receive dividends.
The Purchase Price payable, and the number of Series A Preferred Shares or
other securities issuable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination, or reclassification of, the Series
A Preferred Shares, (ii) upon the grant to holders of the Series A Preferred
Shares of certain rights or warrants to subscribe for or purchase Series A
Preferred Shares at a price, or securities convertible into Series A Preferred
Shares with a conversion price, less than the then-current market price of the
Series A Preferred Shares, or (iii) upon the distribution to holders of the
Series A Preferred Shares of evidences of indebtedness or cash (excluding
regular periodic cash dividends), assets, or stock (excluding dividends payable
in Series A Preferred Shares) or of subscription rights or warrants (other than
those referred to above). The number of outstanding Rights and the number of
one one-hundredths of a Series A Preferred Share issuable upon exercise of each
Right also is subject to adjustment in the event of a stock dividend on the
Common Stock payable in shares of Common Stock or a subdivision, combination,
or reclassification of the Common Stock occurring, in any such case, prior to
the Rights Distribution Date.
The Series A Preferred Shares issuable upon exercise of the Rights will not
be redeemable. Each Series A Preferred Share will be entitled to a minimum
preferential quarterly dividend payment equal to the greater of (i) $1.00 per
share and (ii) an amount equal to 100 times the aggregate dividends declared
per share of Common Stock during the related quarter. In the event of
liquidation, the holders of the Series A Preferred Shares will be entitled to a
preferential liquidation payment equal to the greater of (a) $100 per share and
(b) an amount equal to 100 times the liquidation payment made per share of
Common Stock. Each Series A Preferred Share will have 100 votes, voting
together with the Common Stock. In the event of any merger, consolidation, or
other transaction in which shares of Common Stock are exchanged, each Series A
Preferred Share will be entitled to receive 100 times the amount received per
share of Common Stock. These rights will be protected by customary
antidilution provisions. Because of the nature of the Series A Preferred
Shares' dividend, voting and liquidation rights, the value of the one
one-hundredth interest in a Series A Preferred Share purchasable upon exercise
of each Right should approximate the value of one share of Common Stock.
Rights may be exercised to purchase Series A Preferred Shares only after
the Rights Distribution Date occurs and prior to the occurrence of a Flip-in
Event or Flip-over Event. A Rights Distribution Date resulting from the
commencement of a tender offer or exchange offer described in clause (ii) of
the definition of "Rights Distribution Date" could precede the occurrence of a
Flip-in Event or Flip-over Event and thus result in the Rights being
exercisable to purchase Series A Preferred Shares. A Rights Distribution Date
resulting from any occurrence described in clause (i) or clause (iii) of the
definition of "Rights Distribution Date" would necessarily follow the
occurrence of a Flip-in Event or Flip-over Event and thus result in the Rights
being exercisable to purchase shares of Common Stock or other securities as
described below.
-14-
<PAGE> 18
In the event (a "Flip-in Event") that (i) any person, together with its
affiliates and associates, becomes the beneficial owner of 20% or more of the
outstanding Common Stock, (ii) any Acquiring Person merges into or combines
with the Company and the Company is the surviving corporation or any Acquiring
Person effects certain other transactions with the Company, as described in the
Share Purchase Rights Agreement, or (iii) during such time as there is an
Acquiring Person, there is any reclassification of securities or
recapitalization or reorganization of the Company which has the effect of
increasing by more than 1% the proportionate share of the outstanding shares of
any class of equity securities of the Company or any of its subsidiaries
beneficially owned by the Acquiring Person, proper provision will be made so
that each holder of a Right, other than Rights that are or were owned
beneficially by the Acquiring Person (which, from and after the later of the
Rights Distribution Date and the date of the earliest of any such events, will
be void), will thereafter have the right to receive upon exercise thereof at
the then-current exercise price of the Right, that number of shares of Common
Stock (or, under certain circumstances, an economically equivalent security or
securities of the Company) that have a market value of two times the exercise
price of the Right.
In the event (a "Flip-over Event") that, following the first date of public
announcement by the Company that a person has become an Acquiring Person, (i)
the Company merges with or into any person and the Company is not the surviving
corporation, (ii) any person merges with or into the Company and the Company is
the surviving corporation, but all or part of the Common Stock is changed or
exchanged, or (iii) 50% or more of the company's assets or earning power,
including without limitation securities creating obligations of the Company,
are sold, proper provision will be made so that each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the
then-current exercise price of the Right, that number of shares of common stock
(or, under certain circumstances, an economically equivalent security or
securities) of such other person which at the time of such transaction would
have a market value of two times the exercise price of the Right.
Following the occurrence of any Flip-in Event or Flip-over Event, Rights
(other than any Rights which have become void) may be exercised as described
above, upon payment of the exercise price or, at the option of the holder
thereof, without the payment of the exercise price that would otherwise be
payable. If a holder of Rights elects to exercise Rights without the payment
of the exercise price that would otherwise be payable, such holder will be
entitled to receive upon the exercise of such Rights securities having a market
value equal to the exercise price of the Rights. In addition, at any time
after the later of the Rights Distribution Date and the first occurrence of a
Flip-in Event or a Flip-over Event and prior to the acquisition by any person
or group of affiliated or associated persons of 50% or more of the outstanding
Common Stock, the Company may exchange the Rights (other than any Rights which
have become void), in whole or in part, at an exchange ratio of one share of
Common Stock per Right (subject to adjustment).
With certain exceptions, no adjustments in the Purchase Price will be
required until cumulative adjustments require an adjustment in the Purchase
Price of at least 1%. The Company is not required to issue fractional Series A
Preferred Shares (other than fractions that are integral multiples of one
one-hundredth of a Series A Preferred Share, which may, at the option of the
Company, be evidenced by depositary receipts) or fractional shares of Common
Stock or other securities issuable upon the exercise of Rights. In lieu of
issuing such securities, the Company may make a cash payment, as provided in
the Share Purchase Rights Agreement.
The Company may redeem the Rights in whole, but not in part, at a price of
$0.03 per Right, subject to adjustment and, in the event that the payment of
such amount would be prohibited by loan agreements or indentures to which the
Company is a party, deferral (the "Redemption Price"), at any time prior to the
close of business on the later of (i) the Rights Distribution Date and (ii) the
first date of public announcement that a person has become an Acquiring Person.
Immediately upon any redemption of the Rights, the right to exercise the Rights
will terminate and the holders will have only the right to receive the
Redemption Price.
The Share Purchase Rights Agreement may be amended by the Company without
the approval of any holders of Rights, including amendments which add other
events requiring adjustment to the Purchase Price payable and the number of
Series A Preferred Shares or other securities issuable upon the exercise of the
Rights which modify procedures relating to the redemption of the Rights,
provided that no amendment may be made which decreases the stated Redemption
Price to an amount less than $0.01 per Right, decreases the period of time
remaining until the Final Expiration Date, or modifies a time period relating
to when the Rights may be redeemed at such time as the Rights are not then
redeemable.
-15-
<PAGE> 19
CERTAIN CORPORATE GOVERNANCE MATTERS
The Company's Certificate of Incorporation and By-Laws provide that the
directors of the Company are to be classified into three classes, with the
directors in each class serving for three-year terms and until their successors
are elected. Any additional person elected to the Board of Directors of the
Company will be added to a particular class of directors to be determined at
the time of such election, although in accordance with the Company's
Certificate of Incorporation and By-Laws, the number of directors in each class
will be identical or as nearly as practicable thereto based on the total number
of directors then serving as such.
The Company's By-Laws provide that nominations for election of directors by
the stockholders will be made by the Board of Directors of the Company or by
any stockholder entitled to vote in the election of directors generally. The
Company's By-Laws require that stockholders intending to nominate candidates
for election as directors deliver written notice thereof to the Secretary of
the Company not later than 60 calendar days in advance of the meeting of
stockholders; provided, however, that in the event that the date of the meeting
is not publicly announced by the Company by inclusion in a report filed with
the Commission or furnished to stockholders, or by mail, press release, or
otherwise more than 75 calendar days prior to the meeting, notice by the
stockholder to be timely must be delivered to the Secretary of the Company not
later than the close of business on the tenth day following the date on which
such announcement of the date of the meeting was so communicated. The
Company's By-Laws further require that the notice by the stockholder set forth
certain information concerning such stockholder and the stockholder's nominees,
including their names and addresses, a representation that the stockholder is
entitled to vote at such meeting and intends to appear in person or by proxy at
the meeting to nominate the person or persons specified in the notice, a
description of all arrangements or understandings between the stockholders and
each nominee, such other information as would be required to be included in a
proxy statement soliciting proxies for the election of the nominees of such
stockholder, and the consent of each nominee to serve as a director of the
Company if so elected. The chairman of the meeting may refuse to acknowledge
the nomination of any person not made in compliance with these requirements.
In addition to the provisions relating to the classification of the Board
of Directors and the director nomination procedures described above, the
Company's Certificate of Incorporation and By-Laws provide, in general, that
(i) the number of directors of the Company will be fixed, within a specified
range, by a majority of the total number of the Company's directors (assuming
no vacancies) or by the holders of at least 80% of the Company's voting stock,
(ii) the directors of the Company in office from time to time will fill any
vacancy or newly created directorship on the Board of Directors of the Company
with any new director to serve in the class of directors to which he or she is
so elected, (iii) directors of the Company may be removed only for cause by the
holders of at least 80% of the Company's voting stock, (iv) stockholder action
can be taken only at an annual or special meeting of stockholders and not by
written consent in lieu of a meeting, (v) except as described below, special
meetings of stockholders may be called only by the Company's Chief Executive
Officer or by a majority of the total number of directors of the Company
(assuming no vacancies) and the business permitted to be conducted at any such
meeting is limited to that brought before the meeting by the Company's Chief
Executive Officer or by a majority of the total number of directors of the
Company (assuming no vacancies), and (vi) subject to certain exceptions, the
Board of Directors of the Company may postpone and reschedule any previously
scheduled annual or special meeting of stockholders. The Company's By-Laws
also require that stockholders desiring to bring any business before an annual
meeting of stockholders deliver written notice thereof to the Secretary of the
Company not later than 60 calendar days in advance of the meeting of
stockholders; provided, however, that in the event that the date of the meeting
is not publicly announced by the Company by press release or inclusion in a
report filed with the Commission or furnished to stockholders more than 75
calendar days prior to the meeting, notice by the stockholders to be timely
must be delivered to the Secretary of the Company not later than the close of
business on the tenth calendar day following the day on which such announcement
of the date of the meeting was so communicated. The Company's By-Laws further
require that the notice by the stockholder set forth a description of the
business to be brought before the meeting and the reasons for conducting such
business at the meeting and certain information concerning the stockholder
proposing such business and the beneficial owner, if any, on whose behalf the
proposal is made including their names and addresses, the class and number of
shares of the Company, that are owned beneficially and of record by each of
them, and any material interest of either of them in the business proposed to
be brought before the meeting. Upon the written request of the holders of not
less than 15% of the Company's voting stock, the Board of Directors of the
Company will be required to call a meeting of stockholders for the purpose
specified in such written request and fix a record date for the determination
of stockholders entitled to notice of and to vote at such meeting (which record
date may not be later than 60 calendar days after the date of receipt of notice
of such meeting), provided that in the event that the Board or Directors of the
-16-
<PAGE> 20
Company calls an annual or special meeting of stockholders to be held not later
than 90 calendar days after receipt of any such written request, no separate
special meeting of stockholders as so requested will be required to be convened
provided that the purposes of such annual or special meeting called by the
Board of Directors of the Company include (among others) the purposes specified
in such written request of the stockholders.
Under applicable provisions of Delaware law, the approval of a Delaware
company's board of directors, in addition to stockholder approval, is required
to adopt any amendment to the company's certificate of incorporation, but a
company's by-laws may be amended either by action of its stockholders or, if
the company's certificate of incorporation so provides, its board of directors.
The Company's Certificate of Incorporation and By-Laws provide that (i) except
as described below, the provisions summarized above and the provisions relating
to the classification of the Board and nominating procedures may not be amended
by the stockholders, nor may any provision inconsistent therewith be adopted by
the stockholders, without the affirmative vote of the holders of at least 80%
of the Company's voting stock, voting together as single class, except that if
any such action (other than any direct or indirect amendments to the provision
requiring that stockholder action be taken at a meeting of stockholders rather
than by written consent in lieu of a meeting) is approved by the holders of a
majority, but less than 80%, of the then-outstanding voting stock (in addition
to any other approvals require by law, including approval by the Board of
Directors of the Company with respect to any amendment to the Company's
Certificate of Incorporation), such action will be effective as of one year
from the date of adoption, or (ii) the Company's By-Law provisions relating to
the right of stockholders to cause special meetings of stockholders to be
called and to the composition of certain directorate committees may not be
amended by the Board without stockholder approval.
The Company is subject to Section 203 of the General Corporation Law of the
State of Delaware (the "DGCL"), which restricts the consummation of certain
business combination transactions in certain circumstances. In addition, the
Company's certificate of incorporation contains provisions that are
substantially similar to those contained in Section 203 of the DGCL that
restrict business combination transactions with (i) any person or group that
became or is deemed to have become the beneficial owner of 15% or more of the
voting stock of the Company as a result of its receipt of Common Stock or
warrants pursuant to Macy's plan of reorganization that thereafter becomes the
beneficial owner of an additional 1% or more of the voting stock of the Company
and (ii) any other person or group that becomes the beneficial owner of 15%
more of the voting stock of the Company.
The foregoing provisions of the Company's Certificate of Incorporation, the
provisions of its By-Laws relating to advance notice of stockholder
nominations, and the provisions of the Share Purchase Rights Agreement (see
"--Preferred Share Purchase Rights") may discourage or make more difficult the
acquisition of control of the Company by means of a tender offer, open market
purchase, proxy contest, or otherwise. These provisions are intended to
discourage or may have the effect of discouraging certain types of coercive
takeover practices and inadequate takeover bids and to encourage persons
seeking to acquire control of the Company first to negotiate with the Company.
The Company's management believes that the foregoing measures, many of which
are substantially similar to the takeover-related measures in effect for many
other publicly held companies, provide benefits by enhancing the Company's
potential ability to negotiate with the proponent of an unfriendly or
unsolicited proposal to take over or restructure the Company that outweigh the
disadvantages of discouraging such proposals because, among other things,
negotiation of such proposals could result in an improvement of their terms.
DESCRIPTION OF WARRANTS
The Company may issue Warrants for the purchase of Debt Securities, Common
Stock, Preferred Stock, Depositary Shares, or any combination thereof.
Warrants may be issued independently, together with any other Securities
offered by a Prospectus Supplement, and may be attached to or separate from
such Securities. Warrants may be issued under warrant agreements (each, a
"Warrant Agreement") to be entered into between the Company and a warrant agent
specified in the applicable Prospectus Supplement (the "Warrant Agent"). The
Warrant Agent will act solely as an agent of the Company in connection with the
Warrants of a particular series and will not assume any obligation or
relationship of agency or trust for or with any holders or beneficial owners of
Warrants. The following sets forth certain general terms and provisions of the
Warrants offered hereby. Further terms of the Warrants and the applicable
Warrant Agreement will be set forth in the applicable Prospectus Supplement.
-17-
<PAGE> 21
The applicable Prospectus Supplement will describe the terms of the
Warrants in respect of which this Prospectus is being delivered, including,
where applicable, the following: (i) the title of such Warrants; (ii) the
aggregate number of such Warrants; (iii) the price or prices at which such
Warrants will be issued; (iv) the designation, number and terms of the Debt
Securities, Common Stock, Preferred Stock, Depositary Shares, or combination
thereof, purchasable upon exercise of such Warrants; (v) the designation and
terms of the other Securities, if any, with which such Warrants are issued and
the number of such Warrants issued with each such Security; (vi) the date, if
any, on and after which such Warrants and the related underlying Securities
will be separately transferable; (vii) the price at which each underlying
Security purchasable upon exercise of such Warrants may be purchased; (viii)
the date on which the right to exercise such Warrants shall commence and the
date on which such right shall expire; (ix) the minimum amount of such Warrants
which may be exercised at any one time; (x) information with respect to
book-entry procedures, if any; (xi) a discussion of any applicable federal
income tax considerations; and (xii) any other terms of such Warrants,
including terms, procedures and limitations relating to the transferability,
exchange and exercise of such Warrants.
PLAN OF DISTRIBUTION
The Company may sell the Securities in any one or more of the following
ways: (i) through one or more underwriters, (ii) through one or more dealers
or agents (which may include one or more underwriters), or (iii) directly to
one or more purchasers.
The distribution of the Securities may be effected from time to time in one
or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. In
connection with the sale of the Securities, underwriters, dealers, and agents
may receive compensation from the Company or from purchasers of the Securities
in the form of discounts, concessions, or commissions. Underwriters, dealers,
and agents who participate in the distribution of the Securities may be deemed
to be underwriters, and any discounts or commissions received by them from the
Company and any profit on the resale of Securities by them may be deemed to be
underwriting discounts and commissions under the Securities Act. Any such
underwriter, dealer, or agent will be identified and any such compensation
received from the Company will be described in an applicable Prospectus
Supplement. Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
Under agreements which may be entered into by the Company, underwriters,
dealers, and agents who participate in the distribution of the Securities may
be entitled to indemnification by the Company against certain liabilities,
including under the Securities Act, or contribution from the Company to
payments which the underwriters, dealers, or agents may be required to make in
respect thereof. The underwriters, dealers, and agents may engage in
transactions with, or perform services for, the Company in the ordinary course
of business.
All Securities will be a new issue of securities with no established
trading market, other than the Common Stock, which is listed on the NYSE. Any
Common Stock sold pursuant to a Prospectus Supplement will be listed on the
NYSE, subject to official notice of issuance. Any underwriters to whom
Securities are sold by the Company for public offering and sale may make a
market in such Securities, but such underwriters will not be obligated to do so
and may discontinue any market making at any time without notice. No assurance
can be given as to the liquidity of the secondary market for any Securities.
VALIDITY OF SECURITIES
Unless otherwise indicated in an applicable Prospectus Supplement relating
to the Securities, the validity of the Securities offered hereby will be passed
upon for the Company by Jones, Day, Reavis & Pogue, New York, New York.
-18-
<PAGE> 22
EXPERTS
The consolidated financial statements of the Company as of January 28,
1995 and January 29, 1994, and for each of the fifty-two week periods ended
January 28, 1995, January 29, 1994, and January 30, 1993, have been
incorporated by reference in this Prospectus in reliance upon the report,
incorporated by reference herein, of KPMG Peat Marwick LLP, independent
certified public accountants and upon the authority of that firm as experts in
accounting and auditing.
The consolidated financial statements of Macy's as of July 30, 1994 and
July 31, 1993 and for each of the fiscal years in the three-year period ended
July 30, 1994 incorporated by reference in this Prospectus have been audited by
Deloitte & Touche LLP, independent auditors, and have been so incorporated in
reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.
The consolidated financial statements of Broadway as of January 28, 1995
and January 29, 1994 and for each of the fiscal years ended January 28, 1995
and January 29, 1994, the 17 weeks ended January 30, 1993, and the 35 weeks
ended October 3, 1992 incorporated by reference in this Prospectus have been so
incorporated in reliance on the reports of Price Waterhouse LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.
The financial statements incorporated herein by reference to reports and
documents subsequently filed by the Company pursuant to Sections 13(a), 13(c),
14, and 15(d) of the Exchange Act prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold, or
which deregisters all securities then remaining unsold, are or will be so
incorporated in reliance upon the reports of KPMG Peat Marwick LLP, or any
other independent public accountants, relating to such financial statements and
upon the authority of such independent public accountants as experts in
accounting and auditing in giving such reports to the extent that the
particular firm has audited such financial statements and consented to the use
of their reports thereon.
-19-
<PAGE> 23
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses in connection with the issuance and distribution of the
securities being registered, other than underwriting discounts and commissions
(which will be described in an applicable Prospectus Supplement), are estimated
as follows:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee . . . . . . . . . . . . . . . $344,827
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75,000
Accounting fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000
Printing and engraving expenses . . . . . . . . . . . . . . . . . . . . . . . . . 25,000
Trustee's fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000
Miscellaneous expenses(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,000
--------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $639,827
========
---------------------
</TABLE>
(1) Includes estimate of stock exchange listing fees, blue sky fees and
expenses, NASD filing fees, and rating agency fees.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Certificate of Incorporation (the "Certificate") provides, as
do the charters of many other publicly held companies, that the personal
liability of directors of the Company to the Company is eliminated to the
maximum extent permitted by Delaware law. The Certificate and the Company's
By-Laws provide for the indemnification of the directors, officers, employees,
and agents of the Company and its subsidiaries to the full extent that may be
permitted by Delaware law from time to time and, in the case of the By-Laws,
for various procedures relating thereto. Certain provisions of the Certificate
protect the Company's directors against personal liability for monetary damages
resulting from breaches of their fiduciary duty of care, except as set forth
below. Under Delaware law, absent these provisions, directors could be held
liable for gross negligence in the performance of their duty of care, but not
for simple negligence. The Certificate absolves directors of liability for
negligence in the performance of their duties, including gross negligence.
However, the Company's directors remain liable for breaches of their duty of
loyalty to the Company and its stockholders, as well as for acts or omissions
not in good faith or which involve intentional misconduct or a knowing
violation of law and transactions from which a director derives improper
personal benefit. The Certificate also does not absolve directors of liability
under section 174 of the Delaware General Corporation Law, which makes
directors personally liable for unlawful dividends or unlawful stock
repurchases or redemptions in certain circumstances and expressly sets forth a
negligence standard with respect to such liability.
Under Delaware law, directors, officers, employees, and other individuals
may be indemnified against expenses (including attorneys' fees), judgments,
fines, and amounts paid in settlement in connection with specified actions,
suits, or proceedings, whether civil, criminal, administrative, or
investigative (other than an action by or in the right of the corporation -- a
"derivative action") if they acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interests of the
Company and, with respect to any criminal action or proceeding, had no
reasonable cause to believe their conduct was unlawful. A similar standard of
care is applicable in the case of a derivative action, except that
indemnification only extends to expenses (including attorneys' fees) incurred
in connection with defense or settlement of such an action and Delaware law
requires court approval before there can be any indemnification of expenses
where the person seeking indemnification has been found liable to the Company.
The Certificate provides, among other things, that each person who was or
is made a party to, or is threatened to be made a party to, or is involved in,
any action, suit, or proceeding by reason of the fact that he or she is or was
a director or officer of the Company (or was serving at the request of the
Company as a director, officer, employee, or agent for another entity), will be
indemnified and held harmless by the Company to the full extent authorized by
Delaware law against all expense, liability, or loss (including attorneys'
fees, judgments, fines, ERISA excise taxes or penalties, and amounts to be paid
in settlement) reasonably incurred by such person in connection therewith. The
II-1
<PAGE> 24
rights conferred thereby will be deemed to be contract rights and will include
the right to be paid by the Company for the expenses incurred in defending the
proceedings specified above in advance of their final disposition.
The Company is a party to indemnification agreements with each of its
directors and officers. These indemnification agreements provide for, among
other things, (i) the indemnification by the Company of the indemnitees
thereunder to the extent described above, (ii) the advancement of attorneys'
fees and other expenses, and (iii) the establishment, upon approval by the
Board, of trusts or other funding mechanisms to fund the Company's
indemnification obligations thereunder.
ITEM 16. EXHIBITS
1.1 -- Underwriting Agreement (to be filed, as applicable to a
particular offering of Securities, as an exhibit to a
Current Report on Form 8-K and incorporated herein by
reference thereto)
4.1 -- Certificate of Incorporation (incorporated by reference to
Exhibit 3.1 of the Company's Annual Report on Form 10-K
(File No. 1-13536) for the fiscal year ended January 28,
1995 ("1994 Form 10- K"))
4.2 -- By-Laws (incorporated by reference to Exhibit 3.2 of the
1994 Form 10-K)
4.3 -- Rights Agreement, dated December 19, 1994, between the
Company and the Bank of New York, as rights agent
(incorporated by reference to Exhibit 4.3 of the 1994 Form
10-K)
4.4 -- Indenture, dated December 15, 1994, between the Company
and State Street Bank and Trust Company (successor to The
First National Bank of Boston), as Trustee (incorporated
by reference to Exhibit 4.1 of the Company's Registration
Statement on Form S-3 (Registration Number 33-88328) filed
with the Commission on January 9, 1995)
4.5 -- Supplemental Indenture (to be filed, as applicable to a
particular offering of Debt Securities, as an exhibit to a
Current Report on Form 8-K and incorporated herein by
reference thereto)
4.6 -- The form or forms of Securities with respect to each
particular series of Securities registered hereunder will
be filed as an exhibit to a Current Report on Form 8-K and
incorporated herein by reference thereto
5.1 -- Opinion of Jones, Day, Reavis & Pogue*
12.1 -- Statement re: Computation of Ratios
23.1 -- Consent of KPMG Peat Marwick LLP
23.2 -- Consent of Price Waterhouse LLP
23.3 -- Consent of Deloitte & Touche LLP
23.4 -- Consent of Jones, Day, Reavis & Pogue (included in Exhibit
5.1)*
24.1 -- Powers of Attorney
25.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 on Form T-1 of State Street Bank and
Trust Company to act as Trustee under the Indenture
____________________
* To be filed by amendment.
II-2
<PAGE> 25
ITEM 17. UNDERTAKINGS
The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made
of the securities registered hereby, 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 Commission 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; and
(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 this
Registration Statement;
provided, however, that the undertakings set forth in paragraphs (i) and
(ii) above shall not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Company pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment will be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time will be deemed to be the
initial bona fide offering thereof.
(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.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the Company's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in this
Registration Statement will be deemed to be a new Registration Statement
relating to the securities offered herein, and the offering of such
securities at that time will be deemed to be the initial bona fide offering
thereof.
(5) That, (i) for purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus filed
as part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be
part of this Registration Statement as of the time it was declared
effective and (ii) for the purpose of determining any liability under the
Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes to file an
application for the purpose of determining the eligibility of the trustee
to act under subsection (a) of Section 310 of the Trust Indenture Act of
1939 in accordance with the rules and regulations prescribed by the
Commission under Section 305(b)(2) of the Trust Indenture Act of 1939.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been
advised
II-3
<PAGE> 26
that in the opinion of the Commission 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 Company of expenses incurred or paid by a director, officer,
or controlling person of the Company 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 Company will,
unless in the opinion of counsel for the Company 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.
II-4
<PAGE> 27
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 Cincinnati, State of Ohio on December 12, 1995.
FEDERATED DEPARTMENT STORES, INC.
By /s/ Dennis J. Broderick
-------------------------------
Dennis J. Broderick,
Senior Vice President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on December 12, 1995.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
* Chairman of the Board and Chief Executive Officer
------------------------------------------ (principal executive officer) and Director
Allen I. Questrom
* Vice Chairman and Chief Financial Officer
------------------------------------------ (principal financial officer) and Director
Ronald W. Tysoe
* Senior Vice President and Controller
------------------------------------------ (principal accounting officer)
John E. Brown
* Director
------------------------------------------
Robert A. Charpie
* Director
------------------------------------------
Lyle Everingham
* Director
------------------------------------------
Meyer Feldberg
* Director
------------------------------------------
Earl G. Graves, Sr.
* Director
------------------------------------------
George V. Grune
* Director
------------------------------------------
Gertrude G. Michelson
* Director
------------------------------------------
Joseph Neubauer
* Director
------------------------------------------
Laurence A. Tisch
Director
------------------------------------------
Paul W. Van Orden
* Director
------------------------------------------
Karl M. von der Heyden
* Director
------------------------------------------
Marna C. Whittington
* Director
------------------------------------------
James M. Zimmerman
</TABLE>
* The undersigned, by signing his name hereto, does sign and execute this
Registration Statement pursuant to the Powers of Attorney executed by the
above-named persons.
/s/ Dennis J. Broderick
-------------------------------------
Dennis J. Broderick,
Attorney-in-Fact
II-5
<PAGE> 28
INDEX TO EXHIBITS
Exhibit
No. Description
------- ----------------------------------------------------------
1.1 -- Underwriting Agreement (to be filed, as applicable to a
particular offering of Securities, as an exhibit to a
Current Report on Form 8-K and incorporated herein by
reference thereto)
4.1 -- Certificate of Incorporation (incorporated by reference to
Exhibit 3.1 of the Company's Annual Report on Form 10-K
(File No. 1-13536) for the fiscal year ended January 28,
1995 ("1994 Form 10- K"))
4.2 -- By-Laws (incorporated by reference to Exhibit 3.2 of the
1994 Form 10-K)
4.3 -- Rights Agreement, dated December 19, 1994, between the
Company and the Bank of New York, as rights agent
(incorporated by reference to Exhibit 4.3 of the 1994 Form
10-K)
4.4 -- Indenture, dated December 15, 1994, between the Company
and State Street Bank and Trust Company (successor to The
First National Bank of Boston), as Trustee (incorporated
by reference to Exhibit 4.1 of the Company's Registration
Statement on Form S-3 (Registration Number 33-88328) filed
with the Commission on January 9, 1995)
4.5 -- Supplemental Indenture (to be filed, as applicable to a
particular offering of Debt Securities, as an exhibit to a
Current Report on Form 8-K and incorporated herein by
reference thereto)
4.6 -- The form or forms of Securities with respect to each
particular series of Securities registered hereunder will
be filed as an exhibit to a Current Report on Form 8-K and
incorporated herein by reference thereto
5.1 -- Opinion of Jones, Day, Reavis & Pogue*
12.1 -- Statement re: Computation of Ratios
23.1 -- Consent of KPMG Peat Marwick LLP
23.2 -- Consent of Price Waterhouse LLP
23.3 -- Consent of Deloitte & Touche LLP
23.4 -- Consent of Jones, Day, Reavis & Pogue (included in Exhibit
5.1)*
24.1 -- Powers of Attorney
25.1 -- Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 on Form T-1 of State Street Bank and
Trust Company to act as Trustee under the Indenture
____________________
* To be filed by amendment.
<PAGE> 1
EXHIBIT 12.1
FEDERATED DEPARTMENT STORES, INC.
COMPUTATION OF HISTORICAL RATIOS OF EARNINGS TO FIXED CHARGES(a)
(in thousands, except ratio data)
<TABLE>
<CAPTION>
The Company (b)
----------------------------------------------------------------------------------
Period Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year
Ended Ended Ended Ended Ended Ended
10/28/95 1/28/95 1/29/94 1/30/93 2/1/92 2/2/91
----------- ------------ ------------ ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Income (loss) before income taxes $ (213,432) $ 331,284 $ 367,780 $ 232,007 $ (1,849,961) $ (547,801)
Add: Portion of rents representative
of the interest factor 109,711 71,109 63,530 63,843 64,055 63,833
Interest expense 365,775 262,115 213,544 258,211 504,257 639,527
---------- ----------- ----------- ----------- ------------ -----------
Adjusted income (loss) 262,054 664,508 644,854 554,061 (1,281,649) 155,559
========== =========== =========== =========== ============ ===========
Fixed charges:
Interest expense 365,775 262,115 213,544 258,211 504,257 639,527
Capitalized interest 891 447 191 126 182 998
Portion of rents representative
of the interest factor 109,711 71,109 63,530 63,843 64,055 63,833
---------- ----------- ----------- ----------- ------------ -----------
Total fixed charges $ 476,377 $ 333,671 $ 277,265 $ 322,180 $ 568,494 $ 704,358
========== =========== =========== =========== ============ ===========
Ratio of earnings to fixed charges - 1.99 2.33 1.72 - -
Deficiency of earnings to fixed charges $ 214,323 - - - $ 1,850,143 $ 548,799
</TABLE>
(a) For purposes of determining the ratio of earnings to fixed charges,
earnings consist of income before income taxes and extraordinary items
plus fixed charges (excluding interest capitalized). Fixed charges
represent interest incurred, amortization of debt expenses, and that
portion of rental expense on operating leases deemed to be the equivalent
of interest.
(b) As a result of the Company's emergence from bankruptcy and its adoption of
fresh-start reporting as of February 1, 1992, the Company's financial
information for periods ending after February 1, 1992 is generally not
comparable to financial information for periods ending on or before
February 1, 1992 and is separated by a black line.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Federated Department Stores, Inc.:
We consent to the use of our audit report dated February 28, 1995 on the
consolidated financial statements of Federated Department Stores, Inc. and
subsidiaries as of January 28, 1995 and January 29, 1994, and for each of the
fifty-two week periods ended January 28, 1995, January 29, 1994 and January 30,
1993, incorporated herein by reference and to the reference to our firm under
the heading "Experts" in the Prospectus.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Cincinnati, Ohio
December 11, 1995
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of Federated
Department Stores, Inc. of our reports dated March 13, 1995 and March 12, 1993
relating to the consolidated financial statements of Broadway Stores, Inc. and
its subsidiaries as of January 28, 1995 and January 29, 1994 and the fiscal
years ended January 28, 1995 and January 29, 1994, the seventeen weeks ended
January 30, 1993, and the thirty-five weeks ended October 3, 1992, which appear
in the Current Report on Form 8-K of Federated Department Stores, Inc. dated
September 21, 1995. We also consent to the reference to us under the heading
"Experts" in such Prospectus.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Los Angeles, California
December 12, 1995
<PAGE> 1
EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Federated Department Stores, Inc. on Form S-3 of our report dated September 19,
1994 (September 28, 29 and 30, 1994 as to Notes 18, 2 and 20 respectively) on
the consolidated financial statements of R.H. Macy & Co., Inc. for the three
years in the period ended July 30, 1994, which expresses an unqualified opinion
and includes explanatory paragraphs relating to the Company's reorganization
proceedings, its ability to continue as a going concern and its method of
accounting for income taxes and postretirement benefits other than pension,
appearing in the Annual Report on Form 10-K of R.H. Macy & Co., Inc. for the
year ended July 30, 1994, which consolidated financial statements are attached
as an Exhibit to the Current Report on Form 8-K of Federated Department Stores,
Inc. dated September 21, 1995, and to the reference to us under the heading
"Experts" in the Prospectus which is part of this Registration Statement.
/s/ Deloitte & Touche LLP
New York, New York
December 11, 1995
<PAGE> 1
EXHIBIT 24.1
POWER OF ATTORNEY
By signing below, I hereby constitute and appoint Ronald W. Tysoe,
Dennis J. Broderick, John R. Sims, and Padma Tatta Cariappa, or any of them, my
true and lawful attorneys and agents to do any and all acts and things and to
execute any and all instruments in my name and behalf in my capacities as
director and/or officer of Federated Department Stores, Inc., a Delaware
corporation (the "Company"), which said attorneys and agents, or any of them,
may deem necessary or advisable or which may be required to enable the Company
to comply with the Securities Act of 1933, as amended (the "Securities Act"),
and any rules, regulations or requirements of the Securities and Exchange
Commission in respect thereof, in connection with a Registration Statement on
Form S-3 (or any other appropriate form) and any abbreviated registration
statement relating thereto permitted pursuant to Rule 462(b) under the
Securities Act for the purpose of registering pursuant to the Securities Act
debt and equity securities of the Company having an aggregate offering price
not to exceed $1.0 billion, including specifically, but without limiting the
generality of the foregoing, the power and authority to sign for me, in my name
and behalf in my capacities as director and/or officer of the Company
(individually or on behalf of the Company), such Registration Statement and any
such abbreviated registration statement, and any and all amendments and
supplements thereto, and to file the same, with all exhibits thereto and other
instruments or documents in connection therewith, with the Securities and
Exchange Commission, and hereby ratify and confirm all that said attorneys and
agents, or any of them, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have executed this Power of Attorney as of
December 8, 1995.
<TABLE>
<S> <C> <C>
/s/ John E. Brown /s/ Robert A. Charpie /s/ Lyle Everingham
--------------------------------- ------------------------------- ------------------------------
John E. Brown Robert A. Charpie Lyle Everingham
/s/ Meyer Feldberg /s/ Earl G. Graves, Sr. /s/ George V. Grune
--------------------------------- ------------------------------- ------------------------------
Meyer Feldberg Earl G. Graves, Sr. George V. Grune
/s/ Karl M. von der Heyden /s/ Gertrude G. Michelson /s/ Joseph Neubauer
--------------------------------- ------------------------------- ------------------------------
Karl M. von der Heyden Gertrude G. Michelson Joseph Neubauer
/s/ Allen I. Questrom /s/ Laurence A. Tisch /s/ Ronald W. Tysoe
--------------------------------- ------------------------------- ------------------------------
Allen I. Questrom Laurence A. Tisch Ronald W. Tysoe
/s/ Paul W. Van Orden /s/ Marna C. Whittington /s/ James M. Zimmerman
--------------------------------- ------------------------------- ------------------------------
Paul W. Van Orden Marna C. Whittington James M. Zimmerman
</TABLE>
<PAGE> 1
EXHIBIT 25.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________
STATEMENT OF ELIGIBILITY UNDER THE
TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility
of a Trustee Pursuant to Section 305(b)(2) __
STATE STREET BANK AND TRUST COMPANY
(Exact name of trustee as specified in its charter)
Massachusetts 04-1867445
(Jurisdiction of incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification No.)
225 Franklin Street, Boston, Massachusetts 02110
(Address of principal executive offices) (Zip Code)
John R. Towers, Esq. Senior Vice President and Corporate Secretary
225 Franklin Street, Boston, Massachusetts 02110
(617)654-3253
(Name, address and telephone number of agent for service)
_____________________
FEDERATED DEPARTMENT STORES, INC.
(Exact name of obligor as specified in its charter)
Delaware 13-3324058
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
151 West 34th Street
New York, New York 10001
7 West Seventh Street
Cincinnati, OH 45202
(Address of principal executive offices) (Zip Code)
____________________
Debt Securities
(Title of indenture securities)
<PAGE> 2
GENERAL
ITEM 1. GENERAL INFORMATION.
FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISORY AUTHORITY TO
WHICH IT IS SUBJECT.
Department of Banking and Insurance of The Commonwealth of
Massachusetts, 100 Cambridge Street, Boston, Massachusetts.
Board of Governors of the Federal Reserve System, Washington,
D.C., Federal Deposit Insurance Corporation, Washington, D.C.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
The obligor is not an affiliate of the trustee or of its
parent, State Street Boston Corporation.
(See note on page 6.)
ITEM 3. THROUGH ITEM 15. NOT APPLICABLE.
ITEM 16. LIST OF EXHIBITS.
LIST BELOW ALL EXHIBITS FILED AS PART OF THIS STATEMENT OF ELIGIBILITY.
1. A COPY OF THE ARTICLES OF ASSOCIATION OF THE TRUSTEE AS NOW IN
EFFECT.
A copy of the Articles of Association of the trustee, as now
in effect, is on file with the Securities and Exchange
Commission as Exhibit 1 to Amendment No. 1 to the Statement of
Eligibility and Qualification of Trustee (Form T-1) filed with
the Registration Statement of Morse Shoe, Inc. (File No.
22-17940) and is incorporated herein by reference thereto.
2. A COPY OF THE CERTIFICATE OF AUTHORITY OF THE TRUSTEE TO COMMENCE
BUSINESS, IF NOT CONTAINED IN THE ARTICLES OF ASSOCIATION.
A copy of a Statement from the Commissioner of Banks of
Massachusetts that no certificate of authority for the trustee
to commence business was necessary or issued is on file with
the Securities and Exchange Commission as Exhibit 2 to
Amendment No. 1 to the Statement of Eligibility and
Qualification of Trustee (Form T-1) filed with the
Registration Statement of Morse Shoe, Inc. (File No. 22-17940)
and is incorporated herein by reference thereto.
3. A COPY OF THE AUTHORIZATION OF THE TRUSTEE TO EXERCISE CORPORATE
TRUST POWERS, IF SUCH AUTHORIZATION IS NOT CONTAINED IN THE DOCUMENTS
SPECIFIED IN PARAGRAPH (1) OR (2), ABOVE.
A copy of the authorization of the trustee to exercise
corporate trust powers is on file with the Securities and
Exchange Commission as Exhibit 3 to Amendment No. 1 to the
Statement of Eligibility and Qualification of Trustee (Form
T-1) filed with the Registration Statement of Morse Shoe, Inc.
(File No. 22-17940) and is incorporated herein by reference
thereto.
4. A COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE, OR INSTRUMENTS
CORRESPONDING THERETO.
A copy of the by-laws of the trustee, as now in effect, is on
file with the Securities and Exchange Commission as Exhibit 4
to the Statement of Eligibility and Qualification of Trustee
(Form T-1) filed with the Registration Statement of Eastern
Edison Company (File No. 33-37823) and is incorporated herein
by reference thereto.
1
<PAGE> 3
5. A COPY OF EACH INDENTURE REFERRED TO IN ITEM 4. IF THE OBLIGOR IS
IN DEFAULT.
Not applicable.
6. THE CONSENTS OF UNITED STATES INSTITUTIONAL TRUSTEES REQUIRED BY
SECTION 321(B) OF THE ACT.
The consent of the trustee required by Section 321(b) of the
Act is annexed hereto as Exhibit 6 and made a part hereof.
7. A COPY OF THE LATEST REPORT OF CONDITION OF THE TRUSTEE PUBLISHED
PURSUANT TO LAW OR THE REQUIREMENTS OF ITS SUPERVISING OR EXAMINING
AUTHORITY.
A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority is annexed hereto as
Exhibit 7 and made a part hereof.
NOTES
In answering any item of this Statement of Eligibility and
Qualification which relates to matters peculiarly within the knowledge of the
obligor or any underwriter for the obligor, the trustee has relied upon
information furnished to it by the obligor and the underwriters, and the
trustee disclaims responsibility for the accuracy or completeness of such
information.
The answer furnished to Item 2. of this statement will be amended, if
necessary, to reflect any facts which differ from those stated and which would
have been required to be stated if known at the date hereof.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, State Street Bank and Trust Company, a corporation
organized and existing under the laws of The Commonwealth of Massachusetts, has
duly caused this statement of eligibility and qualification to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of Boston
and The Commonwealth of Massachusetts, on the 12th day of December, 1995.
STATE STREET BANK AND TRUST COMPANY
By: /s/ Mark Nelson
--------------------------------
Mark Nelson
Vice President
2
<PAGE> 4
EXHIBIT 6
CONSENT OF THE TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939, as amended, in connection with the proposed issuance by Federated
Department Stores, Inc. of its Debt Securities, we hereby consent that reports
of examination by Federal, State, Territorial or District authorities may be
furnished by such authorities to the Securities and Exchange Commission upon
request therefor.
STATE STREET BANK AND TRUST COMPANY
By: /s/ Mark Nelson
--------------------------------
Mark Nelson
Vice President
Dated: December 12, 1995
3
<PAGE> 5
EXHIBIT 7
Consolidated Report of Condition of State Street Bank and Trust Company of
Boston, Massachusetts and foreign and domestic subsidiaries, a state banking
institution organized and operating under the banking laws of this commonwealth
and a member of the Federal Reserve System, at the close of business December
31, 1994, published in accordance with a call made by the Federal Reserve Bank
of this District pursuant to the provisions of the Federal Reserve Act and in
accordance with a call made by the Commissioner of Banks under General Laws,
Chapter 172, Section 22(a).
<TABLE>
<CAPTION>
Thousands of
ASSETS Dollars
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin . . . . . . . . . . . . . . . . . . 942,661
Interest-bearing balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,843,628
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,410,339
Federal funds sold and securities purchased
under agreements to resell in domestic offices
of the bank and its Edge subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . 2,240,374
Loans and lease financing receivables:
Loans and leases, net of unearned income . . . 3,257,795
Allowance for loan and lease losses . . . . . . 58,184
Loans and leases, net of unearned income and allowances . . . . . . . . . . . . . . . . 3,199,611
Assets held in trading accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 825,549
Premises and fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 375,086
Other real estate owned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,359
Investments in unconsolidated subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . 25,051
Customers' liability to this bank on acceptances outstanding . . . . . . . . . . . . . . . . . 55,358
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,862
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 653,750
----------
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,610,628
==========
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,946,262
Noninterest-bearing . . . . . . . 4,175,167
Interest-bearing 1,771,095
In foreign offices and Edge subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . 8,147,182
Noninterest-bearing . . . . . . . . . 44,817
Interest-bearing . . . . . . . . . . 8,102,365
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of
the bank and of its Edge subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . 4,912,704
Demand notes issued to the US Treasury and Trading Liabilities . . . . . . . . . . . . . . . . 423,324
Other borrowed money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386,049
Bank's liability on acceptances executed and outstanding . . . . . . . . . . . . . . . . . . . 55,621
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 530,536
----------
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,401,678
----------
EQUITY CAPITAL
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,043
Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177,736
Undivided profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,003,171
----------
Total equity capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,208,950
----------
Total liabilities and equity capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,610,628
==========
</TABLE>
4
<PAGE> 6
I, Rex S. Schuette, Senior Vice President and Comptroller of the above named
bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Rex S. Schuette
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
David A. Spina
Marshall N. Carter
Charles F. Kaye
5
