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EXHIBIT 1
FEDERATED DEPARTMENT STORES, INC.
61/8% TERM ENHANCED REMARKETABLE SECURITIES(SM) (TERMS(SM))
Underwriting Agreement
August 19, 1998
Credit Suisse First Boston Corporation
Chase Securities Inc.
Xxxxxxx, Xxxxx & Co.
BancAmerica Xxxxxxxxx Xxxxxxxx
Citicorp Securities, Inc.
c/o Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Federated Department Stores, Inc., a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to you (the "Underwriters") an aggregate of $350,000,000
principal amount of 61/8% Term Enhanced ReMarketable Securities(sm) (the
"TERMS(sm)").
1. The Company represents and warrants to, and agrees with,
each of the Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-34321)
in respect of the TERMS has been filed with the Securities and Exchange
Commission (the "Commission"); such registration statement and any
post-effective amendment thereto, each in the form heretofore delivered
or to be delivered to the Underwriters without exhibits thereto, but
with documents incorporated by reference in the prospectus contained
therein, have been declared effective by the Commission in such form;
no other document with respect to such registration statement or
document incorporated by reference therein has heretofore been filed or
transmitted for filing with the Commission (other than prospectuses
filed or to be filed pursuant to Rule 424(b) of the rules and
regulations of the Commission under the Securities Act of 1933, as
amended (the "Act"), each in the form heretofore delivered or to be
delivered to the Underwriters); and no stop order suspending the
effectiveness of such registration statement has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in such registration
statement or filed with the Commission pursuant to Rule 424(a) under
the Act is hereinafter called a "Preliminary Prospectus"; the various
parts of such registration statement, including all exhibits thereto
and the documents incorporated by reference in the prospectus contained
in the registration statement at the time such part of the registration
statement became effective but excluding Form T-1, each as amended at
the time such part of the registration statement became effective, are
hereinafter collectively called the "Registration Statement"; the
prospectus relating to the TERMS, in the form in which it has most
recently been filed, or transmitted for filing, with the Commission
on or prior to the date of this Agreement,
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being hereinafter called the "Prospectus"; any reference herein to
any Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference
in such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company filed
pursuant to Sections 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated by
reference in the Registration Statement; and any reference to the
Prospectus as amended or supplemented shall be deemed to refer to the
Prospectus as amended or supplemented in relation to the TERMS in the
form in which it is filed with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 5(a) hereof, including any
documents incorporated by reference therein as of the date of such
filing);
(b) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of
the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein, or necessary to make the
statements therein not misleading; and any further documents so filed
and incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents become effective
or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by the Underwriters
through Credit Suisse First Boston Corporation expressly for use in the
Prospectus as amended or supplemented;
(c) The Registration Statement and the Prospectus conform, and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"), and the rules and regulations of the
Commission thereunder and do not and will not, as of the applicable
effective date as to the Registration Statement and any amendment
thereto and as of the applicable filing date as to the Prospectus and
any amendment or supplement thereto, contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by the
Underwriters through Credit Suisse First Boston Corporation expressly
for use in the Prospectus as amended or supplemented;
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(d) There has not been any material adverse change in the
business, financial position or results of operations of the Company
and its subsidiaries, taken as a whole, from the respective dates as of
which information is given in the Registration Statement and the
Prospectus. Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus as amended or
supplemented; and, since the respective dates as of which information
is given in the Registration Statement and the Prospectus, there has
not been any change in the capital stock (other than issuances and
forfeitures of stock in connection with equity-based compensation plans
of executive officers of the Company or as set forth or contemplated in
the Prospectus as amended or supplemented), or any increase in excess
of $25,000,000 in long-term debt of the Company or any of its
subsidiaries otherwise than as set forth or contemplated in the
Prospectus as amended or supplemented, or any material adverse change,
or any development involving a prospective material adverse change, in
or affecting the general affairs, management, financial position,
shareholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus as amended or supplemented;
(e) The Company and its subsidiaries have good and marketable
title to all real property and title to all personal property owned by
them, in each case free and clear of all liens, encumbrances and
defects except such as are disclosed in the Prospectus as amended or
supplemented, or as do not, individually or in the aggregate, have a
material adverse effect on the business, financial position or results
of operations or reasonably foreseeable prospects of the Company and
its subsidiaries taken as a whole (a "Material Adverse Effect"); and
any real property and buildings held under lease by the Company and its
subsidiaries are held by them under valid, subsisting and enforceable
leases with such exceptions as would not, individually or in the
aggregate, have a Material Adverse Effect;
(f) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus as
amended or supplemented, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it is required to be
so qualified, except where failure to be so qualified and in good
standing individually or in the aggregate would not have a Material
Adverse Effect; and each Significant Subsidiary (as such term is
defined in Rule 405 under the Act) has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation and each subsidiary of the Company
has been duly incorporated and is validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation,
except where failure to be duly incorporated, validly existing and in
good standing would not, individually or in the aggregate, have a
Material Adverse Effect;
(g) All of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable; all of the issued shares of capital stock of each
Significant Subsidiary have been duly and validly authorized and
issued, are fully paid and non-assessable and (except as otherwise
disclosed in the Prospectus as amended or supplemented) are owned
directly or indirectly by the Company, free and clear of all material
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liens, encumbrances, equities or claims; and all of the issued shares
of capital stock of each subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable and
are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims (except as otherwise disclosed
in the Prospectus as amended or supplemented or where, individually or
in the aggregate, the failure to have been duly and validly authorized
and issued, to be fully paid and non-assessable and to be owned
directly or indirectly by the Company free and clear of liens,
encumbrances, equities or claims would not have a Material Adverse
Effect);
(h) The TERMS have been duly authorized and, when issued and
delivered pursuant to this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the benefits
provided by the Indenture, dated as of September 10, 1997 (the
"Indenture"), as supplemented by the Second Supplemental Indenture, to
be dated as of August 26, 1998 (the "Second Supplemental Indenture"),
between the Company and Citibank N.A., as Trustee (the "Trustee"),
under which the TERMS are to be issued; the Indenture has been duly
authorized, executed and delivered and duly qualified under the Trust
Indenture Act; the Indenture constitutes (and the Second Supplemental
Indenture, when executed and delivered by the Company and the Trustee,
will constitute) a valid and legally binding instrument, enforceable in
accordance with its terms, except as the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, and other laws of
general applicability relating to or affecting creditors' rights and to
general principles of equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law; and the TERMS and
the Indenture will conform in all material respects to the descriptions
thereof in the Prospectus as amended or supplemented;
(i) The issue and sale of the TERMS and the compliance by the
Company with all of the provisions of the TERMS, the Indenture, as
supplemented by the Supplemental Indenture, and this Agreement and the
consummation of the transactions herein and therein contemplated will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, sale/leaseback agreement, loan agreement or
other similar financing agreement or instrument or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries
is subject, except for such conflicts, breaches, violations and
defaults as individually or in the aggregate would not have a Material
Adverse Effect, nor will such action result in any material violation
of the provisions of the Certificate of Incorporation or By-laws of the
Company or any material statute, order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or
any of its Significant Subsidiaries or any of their properties, nor
will such action result in any violation of the provisions of any
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any of its
subsidiaries or any of their properties except for such violations as
individually or in the aggregate would not have a Material Adverse
Effect; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the issue and sale of the TERMS or the consummation by
the Company of the transactions contemplated by this Agreement or the
Indenture, as supplemented by the Supplemental Indenture, except the
registration of the TERMS under the Act, the Exchange Act and such as
have been obtained under the Trust Indenture Act and such consents,
approvals,
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authorizations, registrations or qualifications as may be required
under state securities or Blue Sky laws in connection with the
purchase and distribution of the TERMS by the Underwriters;
(j) Except for such of the following violations, defaults and
failures as individually or in the aggregate would not have a Material
Adverse Effect, neither the Company nor any of its subsidiaries (i) is
in violation of its certificate of incorporation or by-laws (or
comparable governing documents), (ii) is in default, and no event has
occurred which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any obligation,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which
it is a party or by which it or any of its properties may be bound, or
(iii) is in violation of any law, ordinance, governmental rule,
regulation or court decree to which it or its property is subject, or
(iv) has failed to obtain any license, permit, certificate, franchise
or other governmental authorization or permit necessary to the
ownership of its property or to the conduct of its business;
(k) The statements set forth in the Prospectus as amended or
supplemented under the captions "Description of Debt Securities" and
"Description of the TERMS", insofar as they purport to constitute a
summary of the terms of the TERMS, and under the captions "Plan of
Distribution" and "Underwriting", insofar as they purport to describe
the provisions of the laws and the documents referred to therein,
constitute accurate summaries of the terms of such documents in all
material respects;
(l) Other than as set forth in the Prospectus as amended or
supplemented, there are no legal or governmental proceedings pending to
which the Company or any of its subsidiaries is a party or of which any
property of the Company or any of its subsidiaries is the subject
which, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect; and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others;
(m) The Company is not and, after giving effect to the
offering and sale of the TERMS, will not be an "investment company" or
an entity "controlled" by an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act"); and
(n) KPMG Peat Marwick LLP, who have certified certain
financial statements of the Company and its subsidiaries, are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
2. Subject to the terms and conditions herein set forth, the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price of 102.123% of the principal amount thereof, provided that,
Credit Suisse First Boston Corporation, in its individual capacity and not as
representative for the Underwriters will be solely responsible for the payment
of 2.6% of such amount, plus accrued interest, if any, from August 26, 1998 to
the Time of Delivery hereunder, the principal amount of TERMS set forth opposite
the name of such Underwriter in Schedule I hereto.
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3. Upon the authorization by the Underwriters of the release
of the TERMS, the several Underwriters propose to offer the TERMS for sale upon
the terms and conditions set forth in the Prospectus as amended or supplemented.
4. (a) The TERMS to be purchased by each Underwriter hereunder
will be represented by one or more definitive global securities in book-entry
form which will be deposited by or on behalf of the Company with The Depository
Trust Company ("DTC") or its designated custodian. The Company will deliver the
TERMS to Credit Suisse First Boston Corporation, for the account of each
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor in federal (same-day) funds by wire transfer to an account
designated by the Company for such purpose, by causing DTC to credit the TERMS
to the account of Credit Suisse First Boston Corporation at DTC. The Company
will cause the certificates representing the TERMS to be made available to
Credit Suisse First Boston Corporation for checking at least twenty-four hours
prior to the Time of Delivery (as defined below) at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be 9:30 a.m., New York City time, on August 26, 1998
or such other time and date as Credit Suisse First Boston Corporation and the
Company may agree upon in writing. Such time and date are herein called the
"Time of Delivery".
(b) The documents to be delivered at the Time of Delivery by
or on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the TERMS and any additional documents requested by the
Underwriters pursuant to Section 7(j) hereof, will be delivered at the offices
of Xxxxxxx Xxxxxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(the "Closing Location"), and the TERMS will be delivered at the Designated
Office, all at the Time of Delivery. A meeting will be held at the Closing
Location at 2:00 p.m., New York City time, on the New York Business Day next
preceding the Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus as amended or supplemented in a
form approved by the Underwriters and to file such Prospectus pursuant
to Rule 424(b) under the Act not later than the Commission's close of
business on the second business day following the execution and
delivery of this Agreement or, if applicable, such earlier time as may
be required by Rule 424(b); to make no further amendment or any
supplement to the Registration Statement or Prospectus after the date
of this Agreement and prior to the Time of Delivery which shall be
disapproved by the Underwriters promptly after reasonable notice
thereof; to advise the Underwriters promptly of such amendment or
supplement after such Time of Delivery and furnish the Underwriters
with copies thereof; to file promptly all reports and any definitive
proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act for so long as the delivery of a prospectus is
required in connection with the offering or sale of the TERMS, and
during such same period to advise the Underwriters promptly after it
receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
with the Commission, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of any
prospectus relating to the TERMS, of the
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suspension of the qualification of the TERMS for offering or sale in
any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or Prospectus
or for additional information; and, in the event of the issuance of
any such stop order or of any such order preventing or suspending the
use of any prospectus relating to the TERMS or suspending any such
qualification, to promptly use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as the
Underwriters may reasonably request to qualify the TERMS for offering
and sale under the securities laws of such jurisdictions in the United
States as the Underwriters may request and to comply with such laws so
as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of the TERMS, provided that in connection therewith the
Company shall not be required to qualify as a foreign corporation, to
file a general consent to service of process in any jurisdiction or to
take any action that would subject it to general taxation in any
jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the business
day next succeeding the date of this Agreement and from time to time
thereafter, to furnish the Underwriters with copies of the Prospectus
as amended or supplemented in such quantities in New York City as the
Underwriters may reasonably request, and, if the delivery of a
prospectus is required at any time prior to the expiration of nine
months after the time of issue of the Prospectus in connection with the
offering or sale of the TERMS and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were
made when such Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary during such same period to amend or
supplement such Prospectus or to file under the Exchange Act any
document incorporated by reference in such Prospectus in order to
comply with the Act, the Exchange Act or the Trust Indenture Act, to
notify the Underwriters and, upon your request and subject to your
approval, to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many
copies as the Underwriters may from time to time reasonably request of
an amended Prospectus or a supplement to the Prospectus which will
correct such statement or omission or effect such compliance; and in
case any Underwriter is required to deliver a prospectus in connection
with sales of any of the TERMS at any time nine months or more after
the time of issue of the Prospectus, upon request of such Underwriter
but at the expense of such Underwriter, to prepare and deliver to such
Underwriter as many copies as such Underwriter may request of an
amended or supplemented Prospectus complying with Section 10(a)(3) of
the Act;
(d) To make generally available to its securityholders as soon
as practicable, but in any event not later than eighteen months after
the effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 9(a) of
the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158, in which case this
Section 5(d) shall not be construed to require the Company to file any
report referred to in Rule 158 prior to the time at which such report
is otherwise due);
(e) During the period beginning from the date hereof and
continuing to and including the later of the Time of Delivery and such
earlier time as the Underwriters may notify the Company,
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not to offer, sell, contract to sell or otherwise dispose of, except as
provided hereunder, any securities of the Company that are
substantially similar to the TERMS;
(f) For so long as TERMS are in global form, to furnish to the
holders thereof as soon as practicable after the end of each fiscal
year an annual report (including a balance sheet and statements of
income, shareholders' equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants)
and, as soon as practicable after the end of each of the first three
quarters of each fiscal year (beginning with the fiscal quarter ending
after the effective date of the Registration Statement), consolidated
summary financial information of the Company and its subsidiaries for
such quarter in reasonable detail; and to furnish to the holders of the
TERMS all other documents specified in Section 7.04 of the Indenture,
all in the manner so specified;
(g) During a period of three years from the effective date of
the Registration Statement, to furnish to the Underwriters copies of
all reports or other communications (financial or other) furnished to
the Company's stockholders generally, and to deliver to the
Underwriters (i) as soon as they are available, (A) copies of any
reports and financial statements furnished to or filed with the
Commission or any national securities exchange on which the TERMS or
any class of securities of the Company is listed and (B) the documents
specified in Section 7.04 of the Indenture, as in effect at the Time of
Delivery, and (ii) such additional information concerning the business
and financial condition of the Company as the Underwriters may from
time to time reasonably request, provided that any material nonpublic
information received by the Underwriters will be held in confidence and
not used in violation of any applicable law (such financial statements
to be on a consolidated basis to the extent the accounts of the Company
and its subsidiaries are consolidated in reports furnished to its
shareholders generally or to the Commission); and
(h) To use the net proceeds received by it from the sale of
the TERMS pursuant to this Agreement in the manner specified in the
Prospectus as amended or supplemented under the caption "Use of
Proceeds."
6. The Company covenants and agrees with the several
Underwriters that the Company will pay or cause to be paid the following: (i)
the fees, disbursements and expenses of the Company's counsel and accountants
in connection with the registration of the TERMS under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of producing any
Agreement among Underwriters, this Agreement, the Indenture, the Blue Sky
Memorandum, closing documents (including any compilations thereof) and any
other documents in connection with the offering, purchase, sale and delivery of
the TERMS; (iii) all expenses in connection with the qualification of the TERMS
for offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters
(not to exceed $5,000 in the aggregate) in connection with such qualification
and in connection with the Blue Sky Memorandum; (iv) any fees charged by
securities rating services for rating the TERMS; (v) the filing fees incident
to, and fees and the disbursements of counsel for the Underwriters in
connection with, any required review by the National Association of Securities
Dealers, Inc. of the terms of the sale of the TERMS; (vi) the cost of preparing
the TERMS; (vii) the fees and expenses of the Trustee and any agent of the
Trustee and the fees and disbursements of counsel for the Trustee in connection
with the Indenture and the TERMS; and (viii) all other costs and
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expenses incident to the performance of its obligations hereunder which are
not otherwise specifically provided for in this Section. It is understood,
however, that, except as provided in this Section, and Sections 7 and 9 hereof,
the Underwriters will pay all of their own costs and expenses, including the
fees of their counsel, transfer taxes on resale of any of the TERMS by them,
and any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters to purchase the TERMS
hereunder shall be subject in the sole discretion of the Underwriters to the
condition that all representations and warranties and other statements of the
Company herein are, at and as of the Time of Delivery, true and correct, the
condition that the Company shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented shall have been
filed with the Commission pursuant to Rule 424(b) within the applicable
time period prescribed for such filing by the rules and regulations
under the Act and in accordance with Section 5(a) hereof and the
Indenture shall have been qualified under the Trust Indenture Act; no
stop order suspending the effectiveness of the Registration Statement
or any part thereof shall have been issued and no proceeding for that
purpose shall have been initiated or threatened by the Commission; and
all requests for additional information on the part of the Commission
shall have been complied with to the reasonable satisfaction of the
Underwriters;
(b) Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the Underwriters,
shall have furnished to the Underwriters a written opinion, dated the
Time of Delivery, in substantially the form attached hereto as Annex
III;
(c) The General Counsel or Deputy General Counsel of the
Company shall have furnished to the Underwriters his written opinion,
dated the Time of Delivery, in substantially the form attached hereto
as Annex IV;
(d) Xxxxx, Day, Xxxxxx & Xxxxx, counsel for the Company, shall
have furnished to the Underwriters a written opinion, dated the Time of
Delivery, in substantially the form attached hereto as Annex V;
(e) On the date hereof at a time prior to the execution of
this Agreement, and at 9:30 a.m., New York City time, on the effective
date of any post-effective amendment to the Registration Statement
filed subsequent to the date of this Agreement, KPMG Peat Marwick LLP
shall have furnished to the Underwriters a letter, dated the date of
delivery thereof, in form and substance satisfactory to the
Underwriters, and KPMG Peat Marwick LLP shall have furnished to the
Underwriters a "bring-down" letter, dated the Time of Delivery, in form
and substance satisfactory to the Underwriters (the executed copy of
the letter delivered prior to the execution of this Agreement is
attached hereto as Annex I and draft the form of the letter to be
delivered on the effective date of any post-effective amendment to the
Registration Statement and as of the Time of Delivery is attached
hereto as Annex II);
(f)(i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus
as first amended or supplemented any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court
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or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus as first amended or supplemented,
and (ii) since the respective dates as of which information is given
in the Prospectus as first amended or supplemented there shall not
have been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, shareholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set
forth or contemplated in the Prospectus as first amended or
supplemented, the effect of which, in any such case described in
clause (i) or (ii), is in the judgment of the Underwriters so material
and adverse as to make it impracticable or inadvisable to proceed with
the public offering or the delivery of the TERMS on the terms and in
the manner contemplated in the Prospectus as first amended or
supplemented;
(g) On or after the date hereof, (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization", as that term
is defined by the Commission for purposes of Rule 436(g)(2) under the
Act, and (ii) no such organization shall have publicly announced that
it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities;
(h) On or after the date hereof, there shall not have occurred
any of the following: (i) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange; (ii) a
suspension or material limitation in trading in the Company's
securities on the New York Stock Exchange; (iii) a general moratorium
on commercial banking activities declared by either Federal or New York
State authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of
a national emergency or war, if the effect of any such event specified
in this clause (iv) in the judgment of the Underwriters makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the TERMS on the terms and in the manner contemplated in
the Prospectus as first amended or supplemented; or (v) the occurrence
of any material adverse change in the existing financial, political or
economic conditions in the United States or elsewhere which, in the
judgment of the Underwriters, would materially and adversely affect the
financial markets or the market for the TERMS and other debt
securities; and
(i) The Company shall have furnished or caused to be furnished
to the Underwriters at the Time of Delivery certificates of officers of
the Company satisfactory to the Underwriters as to the accuracy of the
representations and warranties of the Company herein at and as of such
Time of Delivery, as to the performance by the Company of all of its
obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (f) of
this Section and as to such other matters as the Underwriters may
reasonably request.
8. (a) The Company will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement or the Prospectus,
or any amendment or supplement thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such
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action or claim as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement or
the Prospectus as amended or supplemented, or any such amendment or supplement
thereto in reliance upon and in conformity with written information furnished to
the Company by any Underwriter through Credit Suisse First Boston Corporation
expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, any preliminary prospectus supplement,
the Registration Statement or the Prospectus as amended or supplemented, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement or
the Prospectus as amended or supplemented, or any such amendment or supplement
thereto in reliance upon and in conformity with written information furnished to
the Company by such Underwriter through Credit Suisse First Boston Corporation
expressly for use therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims,
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damages or liabilities (or actions in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other from the offering of the TERMS. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company on the one hand or the Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this subsection
(d) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above
in this subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the TERMS underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section 8 shall
be in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company (including any
person who, with his or her consent, is named in the Registration Statement as
about to become a director of the Company) and to each person, if any, who
controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the TERMS which it has agreed to purchase hereunder, the Underwriters
may in their discretion arrange for the Underwriters or another party or other
parties to purchase such TERMS on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Underwriters do not
arrange for the purchase
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of such TERMS, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to the Underwriters to purchase such TERMS on such terms. In the
event that, within the respective prescribed periods, the Underwriters notify
the Company that they have so arranged for the purchase of such TERMS or the
Company notifies the Underwriters that it has so arranged for the purchase of
such TERMS, as the case may be, the Underwriters or the Company shall have the
right to postpone the Time of Delivery for a period of not more than seven days
in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus as amended or supplemented or in any
other documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the opinion of the Underwriters may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to this Agreement with respect to such TERMS.
(b) If, after giving effect to any arrangements for the
purchase of the TERMS of a defaulting Underwriter or Underwriters by the
Underwriters and the Company as provided in subsection (a) above, the aggregate
principal amount of such TERMS which remains unpurchased does not exceed
one-eleventh of the aggregate principal amount of all the TERMS, then the
Company shall have the right to require each non-defaulting Underwriter to
purchase the principal amount of TERMS which such Underwriter agreed to purchase
hereunder and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the principal amount of TERMS which such
Underwriter agreed to purchase hereunder) of the TERMS of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the
purchase of the TERMS of a defaulting Underwriter or Underwriters by the
Underwriters and the Company as provided in subsection (a) above, the aggregate
principal amount of TERMS which remains unpurchased exceeds one-eleventh of the
aggregate principal amount of all the TERMS, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase the TERMS of a defaulting Underwriter or Underwriters,
then this Agreement shall thereupon terminate, without liability on the part of
any non-defaulting Underwriter or the Company, except for the expenses to be
borne by the Company and the Underwriters as provided in Section 6 hereof and
the indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of and payment for the TERMS.
11. If this Agreement shall be terminated pursuant to Section
9 hereof, the Company shall not then be under any liability to any Underwriter
except as provided in Sections 6 and 8 hereof; but, if for any other reason,
the TERMS are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Underwriters for all out-of-pocket expenses,
including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the
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purchase, sale and delivery of the TERMS, but the Company shall then be under
no further liability to any Underwriter except as provided in Sections 6 and 8
hereof.
12. All statements, requests, notices and agreements hereunder
shall be in writing, and if to the Underwriters shall be delivered or sent by
mail, telex or facsimile transmission to the Underwriters in care of Credit
Suisse First Boston Corporation, 00 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Investment Banking Department - Transactions Advisory Group; and if
to the Company shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: Chief Financial Officer and Attention: Secretary;
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
hereof shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to the
Company by the Underwriters upon request. Any such statements, requests, notices
or agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to
the benefit of, the Underwriters, the Company and, to the extent provided in
Sections 8 and 10 hereof, the officers and directors of the Company and each
person who controls the Company or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the TERMS from any Underwriter shall be deemed a successor or assign by
reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
15. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
16. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such respective counterparts shall together constitute
one and the same instrument.
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If the foregoing is in accordance with your understanding,
please sign and return to us seven counterparts hereof, and upon the acceptance
hereof by the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement among each of the Underwriters and the Company.
Very truly yours,
FEDERATED DEPARTMENT STORES, INC.
By: /s/ XXXXX XXXXXX
----------------------------
Name: Xxxxx Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
Accepted as of the date hereof:
CREDIT SUISSE FIRST BOSTON CORPORATION
CHASE SECURITIES INC.
XXXXXXX, XXXXX & CO.
BANCAMERICA XXXXXXXXX XXXXXXXX
CITICORP SECURITIES, INC.
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ XXXXX XXXXXXX
----------------------------------
On behalf of each of the Underwriters
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SCHEDULE I
Principal Amount of TERMS
to be Purchased
-------------------------
Credit Suisse First Boston Corporation .... $148,750,000
Xxxxxxx, Xxxxx & Co. ...................... 148,750,000
Chase Securities Inc. ..................... 35,000,000
BancAmerica Xxxxxxxxx Xxxxxxxx ............ 8,750,000
Citicorp Securities, Inc. ................. 8,750,000
------------
Total ................................ $350,000,000
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