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EXHIBIT 4.2
EXECUTION COPY
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FEDERATED DEPARTMENT STORES, INC.
and
CITIBANK, N.A.
Trustee
THIRD SUPPLEMENTAL TRUST INDENTURE
Dated as of March 24, 1999
Supplementing that certain
INDENTURE
Dated as of September 10, 1997
Authorizing the Issuance and Delivery of
Senior Securities
consisting of $350,000,000 aggregate principal amount of
6.30% Senior Notes Due 2009
and
consisting of $400,000,000 aggregate principal amount of
6.90% Senior Debentures Due 2029
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TABLE OF CONTENTS
Page
RECITALS .........................................................................................2
ARTICLE I. CERTAIN DEFINITIONS ..................................................................3
Section 1.1. Certain Definitions .......................................................3
ARTICLE II. ISSUANCE OF THE SECURITIES .........................................................11
Section 2.1. Form of Securities; Issuance of Initial Securities .......................11
Section 2.2. Execution; Authentication and Delivery of Securities .....................12
Section 2.3. Transfer and Exchange ....................................................13
Section 2.4. Certificated Securities ..................................................16
Section 2.5. Voting and Consent Rights ................................................17
ARTICLE III. CERTAIN COVENANTS .................................................................17
Section 3.1. Liens. ...................................................................17
Section 3.2. Sale and Leaseback Transactions ..........................................17
Section 3.3. Permitting Unrestricted Subsidiaries to Become Restricted Subsidiaries ...18
Section 3.4. Payment Office ...........................................................19
ARTICLE IV. ADDITIONAL EVENTS OF DEFAULT ........................................................19
Section 4.1. Additional Events of Default .............................................19
ARTICLE V. DEFEASANCE ...........................................................................20
Section 5.1. Applicability of Article V of the Indenture ..............................20
ARTICLE VI. REDEMPTION OF SECURITIES ............................................................20
Section 6.1. Right of Redemption ......................................................20
ARTICLE VII. MISCELLANEOUS ......................................................................21
Section 7.1. Reference to and Effect on the Indenture .................................21
Section 7.2. Waiver of Certain Covenants ..............................................21
Section 7.3. Supplemental Indenture May be Executed In Counterparts ...................21
Section 7.4. Effect of Headings .......................................................21
[Form of Face of Initial Securities] .................................................... Exhibit A
[Form of Reverse of Initial Securities] ................................................. Exhibit A
[Form of Face of Exchange Securities/ Private Exchange Securities] ...................... Exhibit B
[Form of Reverse of Exchange Securities/ Private Exchange Securities] ................... Exhibit B
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THIRD SUPPLEMENTAL INDENTURE, dated as of March 24, 1999, between
Federated Department Stores, Inc., a corporation duly organized and existing
under the laws of the State of Delaware (the "Company"), and Citibank, N.A., a
national banking association duly organized and validly existing under the laws
of the United States of America, as Trustee (the "Trustee"), supplementing that
certain Indenture, dated as of September 10, 1997, between the Company and the
Trustee (the "Indenture").
RECITALS
A. The Company has duly authorized the execution and delivery of the
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes, or other evidences of indebtedness to be issued in one or
more series as provided for in the Indenture.
B. The Indenture provides that the securities of each series issued
thereunder shall be in substantially the form set forth in the Indenture, or in
such other form as may be established by or pursuant to a Board Resolution or in
one or more indentures supplemental thereto, in each case with such appropriate
insertions, omissions, substitutions, and other variations as are required or
permitted by the Indenture, and may have such letters, numbers, or other marks
of identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently therewith, be determined by the officers executing such securities,
as evidenced by their execution thereof.
C. The Company and the Trustee have agreed that the Company shall
issue and deliver, and the Trustee shall authenticate, (1) securities
denominated "6.30% Senior Notes Due 2009" (the "Senior Notes") and "6.90% Senior
Debentures Due 2029" (the "Senior Debentures" and, together with the Senior
Notes, the "Initial Securities"), and (2), if and when issued in exchange for
Initial Securities as provided in the Registration Rights Agreement (as
hereinafter defined in this Supplemental Indenture), securities denominated
"6.30% Series B Senior Notes Due 2009" (the "Exchange Notes") and "6.90% Series
B Senior Debentures Due 0000" (xxx "Xxxxxxxx Xxxxxxxxxx" and, together with the
Exchange Notes, the "Exchange Securities") and (3) if and when issued in
exchange for Initial Securities pursuant to a private exchange as provided in
the Registration Rights Agreement, securities denominated "6.30% Series C Senior
Notes Due 2009" (the "Private Exchange Notes") and "6.90% Series C Senior
Debentures Due 2029" (the "Private Exchange Debentures" and, together with the
Private Exchange Notes, the "Private Exchange Securities" and, together with the
Initial Securities and the Exchange Securities, the "Securities") pursuant to
the terms of this Supplemental Indenture and substantially in the form provided
below, in each case with such appropriate insertions, omissions, substitutions,
and other variations as are required or permitted by the Indenture and this
Supplemental Indenture, and with such letters, numbers, or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of such Securities.
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D. All acts and things necessary to make the Securities, when the
Securities have been executed by the Company and authenticated by the Trustee
and delivered as provided in the Indenture and this Supplemental Indenture, the
valid, binding, and legal obligations of the Company and to constitute these
presents a valid indenture and agreement according to its terms, have been done
and performed, and the execution and delivery by the Company of the Indenture
and this Supplemental Indenture and the issue hereunder of the Securities have
in all respects been duly authorized; and the Company, in the exercise of legal
right and power in it vested, has executed and delivered the Indenture and is
executing and delivering this Supplemental Indenture and proposes to make,
execute, issue, and deliver the Securities.
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
In order to declare the terms and conditions upon which the
Securities are authenticated, issued, and delivered, and in consideration of the
premises and of the purchase and acceptance of the Securities by the Holders
thereof, it is mutually agreed, for the equal and proportionate benefit of the
respective Holders from time to time of the Securities, as follows:
ARTICLE I. CERTAIN DEFINITIONS.
SECTION 1.1. CERTAIN DEFINITIONS.
The terms defined in this Section 1.1 (except as herein otherwise
expressly provided or unless the context of this Supplemental Indenture
otherwise requires) for all purposes of this Supplemental Indenture and of any
indenture supplemental hereto have the respective meanings specified in this
Section 1.1. All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with GAAP. All other terms used in this
Supplemental Indenture that are defined in the Indenture or the Trust Indenture
Act, either directly or by reference therein (except as herein otherwise
expressly provided or unless the context of this Supplemental Indenture
otherwise requires), have the respective meanings assigned to such terms in the
Indenture or the Trust Indenture Act, as the case may be, as in force at the
date of this Supplemental Indenture as originally executed.
"Additional Interest" has the meaning provided in the Registration
Rights Agreement.
"Agent Members" has the meaning provided in Section 2.1(d).
"Bank Facilities" means the financing provided to the Company by
certain financial institutions pursuant to (i) the Five-Year Credit Agreement,
pursuant to which such financial institutions have provided the Company with a
$1,500,000,000 revolving loan facility and (ii) the 364-Day Credit Agreement,
pursuant to which such financial institutions have provided the Company with a
$500,000,000 revolving loan facility, with Citibank N.A., as administrative
agent and paying agent, The Chase Manhattan Bank as administrative agent,
BankBoston, N.A. as
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syndication agent, and Bank of America National Trust & Savings Association, as
documentation agent, as the same may be amended, supplemented, or otherwise
modified from time to time.
"Cash Equivalent" means: (a) obligations issued or unconditionally
guaranteed as to principal and interest by the United States of America or by
any agency or authority controlled or supervised by and acting as an
instrumentality of the United States of America; (b) obligations (including, but
not limited to, demand or time deposits, bankers' acceptances and certificates
of deposit) issued by a depository institution or trust company or a wholly
owned Subsidiary or branch office of any depository institution or trust
company, provided that (i) such depository institution or trust company has, at
the time of the Company's or any Restricted Subsidiary's Investment therein or
contractual commitment providing for such Investment, capital, surplus, or
undivided profits (as of the date of such institution's most recently published
financial statements) in excess of $100.0 million and (ii) the commercial paper
of such depository institution or trust company, at the time of the Company's or
any Restricted Subsidiary's Investment therein or contractual commitment
providing for such Investment, is rated at least A1 by S&P or P-1 by Moody's;
(c) debt obligations (including, but not limited to, commercial paper and medium
term notes) issued or unconditionally guaranteed as to principal and interest by
any corporation, state, or municipal government or agency or instrumentality
thereof, or foreign sovereignty, if the commercial paper of such corporation,
state, or municipal government or foreign sovereignty, at the time of the
Company's or any Restricted Subsidiary's Investment therein or contractual
commitment providing for such Investment, is rated at least A1 by S&P or P-1 by
Moody's; (d) repurchase obligations with a term of not more than seven days for
underlying securities of the type described above entered into with a depository
institution or trust company meeting the qualifications described in clause (b)
above; and (e) Investments in money market or mutual funds that invest
predominantly in Cash Equivalents of the type described in clauses (a), (b),
(c), and (d) above; provided, however, that, in the case of clauses (a) through
(c) above, each such Investment has a maturity of one year or less from the date
of acquisition thereof.
"Consolidated Net Tangible Assets" means total assets (less
depreciation and valuation reserves and other reserves and items deductible from
gross book value of specific asset accounts under GAAP) after deducting
therefrom (i) all current liabilities and (ii) all goodwill, trade names,
trademarks, patents, unamortized debt discount, organization expenses, and other
like intangibles, all as set forth on the most recent balance sheet of the
Company and its consolidated Subsidiaries and computed in accordance with GAAP.
"Depositary" means The Depository Trust Company, its nominees and
their respective successors and assigns.
"Exchange Debentures" has the meaning provided in the recitals
hereto.
"Exchange Notes" has the meaning provided in the recitals hereto.
"Exchange Securities" has the meaning provided in the recitals
hereto.
"Existing Indebtedness" means all Indebtedness under or evidenced
by: (a) the Securities; (b) the Company's 7% Senior Debentures Due 2028; (c)
the Company's "6 1/8% Term Enhanced Remarketable Securities(SM)"; (d) the
Company's 6.79% Senior Debentures Due 2027; (e)
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the Company's 10% Senior Notes Due 2001; (f) the Company's 8.125% Senior Notes
Due 2002; (g) the Company 8 1/2% Senior Notes due 2003; (h) the Company's 7.45%
Senior Debentures due 2017; (i) Fingerhut's 7.375% Senior Notes due 1999; (j)
the outstanding principal amount of notes issued pursuant to the Mortgage Note
Agreement, between Macy's Primary Real Estate, Inc. and Federated Noteholding
Corporation; (k) the outstanding principal amount of notes issued pursuant to
the Loan Agreement among Lazarus PA, Inc., PNC Bank Ohio, National Association,
as agent, and the financial institutions party thereto; (l) Capital Lease
Obligations of the Company and the Restricted Subsidiaries existing on the date
of issuance of the Initial Securities; and (m) the other secured Indebtedness of
the Company or secured or unsecured Indebtedness of the Restricted Subsidiaries
existing on the date of the issuance of the Initial Securities.
"Fingerhut" means Fingerhut Companies, Inc.
"Global Securities" has the meaning provided in Section 2.1(c).
"Initial Purchasers" means Credit Suisse First Boston Corporation,
Xxxxxxx Xxxxx Xxxxxx Inc., Xxxxx Securities Inc., NationsBanc Xxxxxxxxxx
Securities LLC and PNC Capital Markets, Inc.
"Initial Securities" has the meaning provided in the recitals
hereto.
"Investment" means, with respect to any Person, any direct or
indirect loan or other extension of credit or capital contribution to (by means
of any transfer of cash or other property to others or any payment for property
or services for the account or use of others), or any purchase or acquisition by
such Person of any capital stock, bonds, notes, debentures, or other securities
or evidences of Indebtedness issued by any other Person. The amount of any
Investment shall be the original cost thereof, plus the cost of all additions
thereto, without any adjustments for increases or decreases in value, write-ups,
write-downs, or write-offs with respect to such Investment.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other),
security interest, or preference, priority, or other security agreement or
preferential arrangement of any kind or nature whatsoever intended to assure
payment of any Indebtedness or other obligation, including without limitation
any conditional sale, deferred purchase price, or other title retention
agreement, the interest of a lessor under a Capital Lease Obligation, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing, under the Uniform Commercial Code or comparable law
of any jurisdiction, of any financing statement naming the owner of the asset to
which such Lien relates as debtor.
"Moody's" means Xxxxx'x Investors Service, Inc. or any successor to
the rating agency business thereof.
"Notice" means, with respect to an Offer to Purchase, a written
notice stating:
(a) the Section of this Supplemental Indenture pursuant to which
such Offer to Purchase is being made;
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(b) the applicable Purchase Amount (including, if less than all the
Securities, the calculation thereof pursuant to the Section hereof
requiring such Offer to Purchase);
(c) the applicable Purchase Date;
(d) the purchase price to be paid by the Company for each $1,000
principal amount at maturity of Securities accepted for payment (as
specified in this Supplemental Indenture);
(e) that the Holder of any Security may tender for purchase by the
Company all or any portion of such Security equal to $1,000 principal
amount or any integral multiple thereof;
(f) the place or places where Securities are to be surrendered for
tender pursuant to such Offer to Purchase;
(g) that any Security not tendered or tendered but not purchased by
the Company pursuant to such Offer to Purchase shall continue to accrue
interest as set forth in such Security and this Supplemental Indenture;
(h) that on the Purchase Date the purchase price shall become due
and payable upon each Security (or portion thereof) selected for purchase
pursuant to such Offer to Purchase and that interest thereon shall cease
to accrue on and after the Purchase Date;
(i) that each Holder electing to tender a Security pursuant to such
Offer to Purchase shall be required to surrender such Security at the
place or places specified in the Notice prior to the close of business on
the fifth Business Day prior to the Purchase Date (such Security being, if
the Company or the Trustee so requires, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Company
and the Trustee duly executed by, the Holder thereof or its attorney duly
authorized in writing);
(j) that (i) if Securities (or portions thereof) in an aggregate
principal amount less than or equal to the Purchase Amount are duly
tendered and not withdrawn pursuant to such Offer to Purchase, the Company
shall purchase all such Securities and (ii) if Securities in an aggregate
principal amount in excess of the Purchase Amount are duly tendered and
not withdrawn pursuant to such Offer to Purchase, (A) the Company shall
purchase Securities having an aggregate principal amount equal to the
Purchase Amount and (B) the particular Securities (or portions thereof) to
be purchased shall be selected by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for purchase
of portions (equal to $1,000 or an integral multiple of $1,000) of the
principal amount of Securities of a denomination larger than $1,000;
(k) that, in the case of any Holder whose Security is purchased only
in part, the Company shall execute, and the Trustee shall authenticate and
deliver to the Holder of such Security without service charge, a new
Security or Security of any authorized denomination
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as requested by such Holder in an aggregate principal amount equal to and
in exchange for the unpurchased portion of the Security so tendered; and
(l) any other information required by applicable law to be included
therein.
"Offer to Purchase" means an offer to purchase Securities pursuant
to and in accordance with a Notice, in the aggregate Purchase Amount, on the
Purchase Date, and at the purchase price specified in such Notice (as determined
pursuant to this Supplemental Indenture). Any Offer to Purchase shall remain
open from the time of mailing of the Notice until the Purchase Date, and shall
be governed by and effected in accordance with, and the Company and the Trustee
shall perform their respective obligations specified in, the Notice for such
Offer to Purchase.
"Permitted Liens" means: (a) Liens (other than Liens on inventory)
securing (A) Existing Indebtedness; (B) Indebtedness under the Bank Facilities
in an aggregate principal amount at any one time not to exceed $2,800.0 million,
less (i) principal payments actually made by the Company on any term loan
facility under such Bank Facilities (other than principal payments made in
connection with or pursuant to a refinancing of the Bank Facilities in
compliance with clause (a)(I) below) and (ii) any amounts by which any revolving
credit facility commitments under the Bank Facilities are permanently reduced
(other than permanent reductions made in connection with or pursuant to a
refinancing of the Bank Facilities in compliance with clause (a)(I) below)
except that under no circumstances shall the total allowable indebtedness under
this clause (a)(B) be less than $1,250.0 million (subject to increase from and
after the date hereof at a rate, compounded annually, equal to 3% per annum) if
incurred for the purpose of providing the Company and its Subsidiaries with
working capital, including without limitation, bankers' acceptances, letters of
credit, and similar assurances of payment whether as part of the Bank Facilities
or otherwise; (C) Indebtedness existing as of the date of the initial issuance
of Securities of any Subsidiary of the Company engaged primarily in the business
of owning or leasing real property; (D) Indebtedness incurred for the purpose of
financing store construction and remodeling or other capital expenditures; (E)
Indebtedness in respect of the deferred purchase price of property or arising
under any conditional sale or other title retention agreement; (F) Indebtedness
of a Person acquired by the Company or a Subsidiary of the Company at the time
of such acquisition; (G) to the extent deemed to be "Indebtedness," obligations
under swap agreements, cap agreements, collar agreements, insurance
arrangements, or any other agreement or arrangement, in each case designed to
provide protection against fluctuations in interest rates, the cost of currency
or the cost of goods (other than inventory); (H) other Indebtedness in
outstanding amounts not to exceed, in the aggregate, the greater of $750.0
million and 12.5% of Consolidated Net Tangible Assets of the Company and the
Restricted Subsidiaries at any particular time; and (I) Indebtedness incurred in
connection with any extension, renewal, refinancing, replacement, or refunding
(including successive extensions, renewals, refinancings, replacements, or
refundings), in whole or in part, of any Indebtedness of the Company or the
Restricted Subsidiaries; provided, however, that the principal amount of the
Indebtedness so incurred does not exceed the sum of the principal amount of the
Indebtedness so extended, renewed, refinanced, replaced, or refunded, plus all
interest accrued thereon and all related fees and expenses (including any
payments made in connection with procuring any required lender or similar
consents); (b) Liens incurred and pledges and deposits made in the ordinary
course of business in connection with liability insurance, workers'
compensation, unemployment insurance, old-age pensions, and other social
security benefits other than in respect of employee benefit plans subject to the
Employee
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Retirement Income Security Act of 1974, as amended; (c) Liens securing
performance, surety, and appeal bonds and other obligations of like nature
incurred in the ordinary course of business; (d) Liens on goods and documents
securing trade letters of credit; (e) Liens imposed by law, such as carriers',
warehousemen's, mechanics', materialmen's, and vendor's Liens, incurred in the
ordinary course of business and securing obligations which are not yet due or
which are being contested in good faith by appropriate proceedings; (f) Liens
securing the payment of taxes, assessments, and governmental charges or levies,
either (i) not delinquent or (ii) being contested in good faith by appropriate
legal or administrative proceedings and as to which adequate reserves shall have
been established on the books of the relevant Person in conformity with GAAP;
(g) zoning restrictions, easements, rights of way, reciprocal easement
agreements, operating agreements, covenants, conditions, or restrictions on the
use of any parcel of property that are routinely granted in real estate
transactions or do not interfere in any material respect with the ordinary
conduct of the business of the Company and its Subsidiaries or the value of such
property for the purpose of such business; (h) Liens on property existing at the
time such property is acquired; (i) purchase money Liens upon or in any property
acquired or held in the ordinary course of business to secure Indebtedness
incurred solely for the purpose of financing the acquisition of such property;
(j) Liens on the assets of any Subsidiary of the Company at the time such
Subsidiary is acquired; (k) Liens with respect to obligations in outstanding
amounts not to exceed $100.0 million at any particular time and that (i) are not
incurred in connection with the borrowing of money or obtaining advances or
credit (other than trade credit in the ordinary course of business) and (ii) do
not in the aggregate interfere in any material respect with the ordinary conduct
of the business of the Company and its Subsidiaries; and (l) without limiting
the ability of the Company or any Restricted Subsidiary to create, incur,
assume, or suffer to exist any Lien otherwise permitted under any of the
foregoing clauses, any extension, renewal, or replacement, in whole or in part,
of any Lien described in the foregoing clauses; provided, however, that any such
extension, renewal, or replacement Lien is limited to the property or assets
covered by the Lien extended, renewed, or replaced or substitute property or
assets, the value of which is determined by the Board of Directors of the
Company to be not materially greater than the value of the property or assets
for which the substitute property or assets are substituted.
"Private Exchange" means the offer by the Company, pursuant to the
Registration Rights Agreement, to the Initial Purchasers to issue and deliver to
each Initial Purchaser, in exchange for the Initial Securities held by the
Initial Purchaser as part of its initial allotment, a like aggregate principal
amount of Private Exchange Securities.
"Private Exchange Debentures" has the meaning provided in the
recitals hereto.
"Private Exchange Notes" has the meaning provided in the recitals
hereto.
"Private Exchange Securities" has the meaning provided in the
recitals hereto.
"Purchase Agreement" means the Purchase Agreement dated March 18,
1999, among the Company and the Initial Purchasers.
"Purchase Amount" means the aggregate outstanding principal amount
of the Securities required to be offered to be purchased by the Company pursuant
to an Offer to Purchase.
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"Purchase Date" means, with respect to any Offer to Purchase, a date
specified by the Company in such Offer to Purchase not less than 30 calendar
days or more than 60 calendar days after the date of the mailing of the Notice
of such Offer to Purchase (or such other time period as is necessary for the
Offer to Purchase to remain open for a sufficient period of time to comply with
applicable securities laws).
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"Registered Exchange Offer" means the offer by the Company, pursuant
to the Registration Rights Agreement, to certain Holders of Initial Securities,
to issue and deliver to such Holders, in exchange for the Initial Securities, a
like aggregate principal amount of Exchange Securities.
"Registration Rights Agreement" means the Registration Rights
Agreement dated March 18, 1999, among the Company and the Initial Purchasers.
"Registration Statement" has the meaning provided in the
Registration Rights Agreement.
"Regulation S" means Regulation S under the Securities Act.
"Restricted Subsidiary" means any Subsidiary of the Company other
than an Unrestricted Subsidiary.
"Rule 144A" means rule 144A under the Securities Act.
"S&P" means Standard & Poor's Ratings Service, a division of The
XxXxxx-Xxxx Companies, Inc., or any successor to the rating agency business
thereof.
"Sale and Leaseback Transaction" means, with respect to any Person,
an arrangement with any bank, insurance company, or other lender or investor or
to which such lender or investor is a party providing for the leasing pursuant
to a Capital Lease by such Person or any Subsidiary of such Person of any
property or asset of such Person or such Subsidiary which has been or is being
sold or transferred by such Person or such Subsidiary to such lender or investor
or to any Person to whom funds have been or are to be advanced by such lender or
investor on the security of such property or asset.
"Securities" means the Initial Securities, the Exchange Securities
and the Private Exchange Securities.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Custodian" means the custodian with respect to the
Global Securities (as appointed by the Depositary), or any successor person
thereto, and shall initially be the Trustee.
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"Senior Indebtedness" means any Indebtedness of the Company or its
Subsidiaries other than Subordinated Indebtedness.
"Senior Debentures" has the meaning provided in the recitals hereto.
"Senior Notes" has the meaning provided in the recitals hereto.
"Shelf Registration Statement" has the meaning provided in the
Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary of the Company which
accounts for (a) 10.0% or more of the total consolidated assets of the Company
and its Subsidiaries as of any date of determination or (b) 10.0% or more of the
total consolidated revenues of the Company and its Subsidiaries for the most
recently concluded fiscal quarter.
"Subordinated Indebtedness" means any Indebtedness of the Company
which is expressly subordinated in right of payment to the Securities.
"Transfer Restricted Securities" means Securities that bear or are
required to bear the legend set forth in Section 2.3(b) hereto.
"Unrestricted Subsidiary" means (a) FDS National Bank, FACS Group,
Inc., Federated Credit Holdings Corporation, Prime Credit Card Master Trust (to
the extent that it is deemed to be a Subsidiary of the Company), Prime Credit
Card Master Trust II (to the extent it is deemed to be a Subsidiary of the
Company), Prime Receivables Corporation, Prime II Receivables Corporation, Seven
Hills Funding Corporation, Ridge Capital Trust II (to the extent that it is
deemed to be a Subsidiary of the Company), Macy Financial, Inc., X.X. Xxxx
Overseas Finance, N.V., Macy Credit Corp., Macy's Data and Credit Services
Corp., Fingerhut Receivables, Inc., PCP Receivables Corp., Fingerhut Master
Trust (to the extent it is deemed to be a Subsidiary of the Company), Fingerhut
National Bank, PCP Master Trust (to the extent it is deemed to be a Subsidiary
of the Company) and Fingerhut Funding Co. (b) any Subsidiary of the Company the
primary business of which consists of, and is restricted by the charter,
partnership agreement, or similar organizational document of such Subsidiary to,
financing operations on behalf of the Company and its Subsidiaries, and/or
purchasing accounts receivable or direct or indirect interests therein, and/or
making loans secured by accounts receivable or direct or indirect interests
therein (and business related to the foregoing), or which is otherwise primarily
engaged in, and restricted by its charter, partnership agreement, or similar
organizational document to, the business of a finance company (and business
related thereto), which, in accordance with the provisions of this Supplemental
Indenture, has been designated by Board Resolution as an Unrestricted
Subsidiary, in each case unless and until any of the Subsidiaries of the Company
referred to in the foregoing clauses (a) and (b) is, in accordance with the
provisions of this Supplemental Indenture, designated by a Board Resolution as a
Restricted Subsidiary, and (c) any Subsidiary of the Company of which, in the
case of a corporation, more than 50% of the issued and outstanding capital stock
having ordinary voting power to elect a majority of the board of directors of
such corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation has or might have voting power upon the
occurrence of any contingency), or, in the case of any partnership or other
legal entity, more than 50% of the ordinary
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equity capital interests, is at the time directly or indirectly owned or
controlled by one or more Unrestricted Subsidiaries and the primary business of
which consists of, and is restricted by the charter, partnership agreement, or
similar organizational document of such Subsidiary to, financing operations on
behalf of the Company and its Subsidiaries, and/or purchasing accounts
receivable or direct or indirect interests therein, and/or making loans secured
by accounts receivable or direct or indirect interests therein (and business
related to the foregoing), or which is otherwise primarily engaged in, and
restricted by its charter, partnership agreement or similar organizational
document to, the business of a finance company (and business related thereto).
ARTICLE II. ISSUANCE OF THE SECURITIES.
SECTION 2.1. FORM OF SECURITIES; ISSUANCE OF INITIAL SECURITIES.
(a) Form of Securities. Certain provisions relating to the Initial
Securities, the Exchange Securities and the Private Exchange Securities are set
forth in Exhibits A and B to this Supplemental Indenture, which are hereby
incorporated in and expressly made a part of this Supplemental Indenture. The
Initial Securities and the related Trustee's certificate of authentication shall
be substantially in the form of Exhibit A to this Supplemental Indenture, which
is hereby incorporated in and expressly made a part of this Supplemental
Indenture. The Exchange Securities, the Private Exchange Securities and the
related Trustee's certificate of authentication shall be substantially in the
form of Exhibit B, which is hereby incorporated in and expressly made a part of
this Supplemental Indenture. Subject to the foregoing, certificates representing
Securities may reflect such appropriate insertions, omissions, substitutions,
and other variations as are required or permitted by the Indenture and this
Supplemental Indenture, and such letters, numbers, or other marks of
identification and such legends or endorsements as may be required to comply
with the rules of any securities exchange or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
(b) Issuance of Initial Securities. The Initial Securities are being
issued and sold by the Company to the Initial Purchasers pursuant to the
Purchase Agreement.
The Senior Notes shall be issued in the aggregate principal
amount of $350,000,000 and shall mature on April 1, 2009. The Senior Debentures
shall be issued in the aggregate principal amount of $400,000,000 and shall
mature on April 1, 2029.
(c) Global Securities. Initial Securities offered and sold to a QIB
in reliance on Rule 144A or in reliance on Regulation S, in each case as
provided in the Purchase Agreement, shall be issued initially in the form of one
or more permanent global Securities in definitive, fully registered form without
interest coupons with the global securities legend and restricted securities
legend set forth in Exhibit A hereto (each, a "Global Security"), which shall be
deposited on behalf of the purchasers of the Initial Securities represented
thereby with the Trustee as custodian for the Depositary (or with such other
custodian as the Depositary may direct), and registered in the name of the
Depositary or a nominee of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Global Securities may from time to time be increased or decreased
by adjustments made on the records of the Trustee and the Depositary or its
nominee as hereinafter provided.
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(d) Book-Entry Provisions. This Section 2.1(d) shall apply only to a
Global Security deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance
with this Section 2.1(d), authenticate and deliver initially one or more Global
Securities that (i) shall be registered in the name of the Depositary for such
Global Security or Global Securities or the nominee of such Depositary and (ii)
shall be delivered by the Trustee to such Depositary or pursuant to such
Depositary's instructions or held by the Trustee as custodian for the
Depositary.
Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under the Indenture with respect to any Global Security
held on their behalf by the Depositary or by the Trustee as the custodian of the
Depositary or under such Global Security, and the Depositary may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depositary
or impair, as between the Depositary and its Agent Members, the operation of
customary practices of such Depositary governing the exercise of the rights of a
holder of a beneficial interest in any Global Security.
(e) Certificated Securities. Except as provided in this Section 2.1
or Section 2.3 or 2.4, owners of beneficial interests in Global Securities will
not be entitled to receive physical delivery of certificated Securities.
SECTION 2.2. EXECUTION; AUTHENTICATION AND DELIVERY OF SECURITIES.
(a) The Securities will be executed on behalf of the Company by the
Chairman or any Vice Chairman of the Board of Directors, the Chief Executive
Officer, the President, or any Vice President of the Company and attested by the
Treasurer, the Secretary, any Assistant Treasurer or any Assistant Secretary of
the Company.
(b) The Trustee shall authenticate and deliver: (1) Senior Notes for
original issue in an aggregate principal amount of U.S. $350,000,000; (2) Senior
Debentures for original issue in an aggregate principal amount of U.S.
$400,000,000; (3) Exchange Notes and, if applicable, Private Exchange Notes for
issue in exchange for a like principal amount of Senior Notes upon the
consummation of a Registered Exchange Offer and, if applicable, a Private
Exchange pursuant to the Registration Rights Agreement; and (4) Exchange
Debentures and, if applicable, Private Exchange Debentures in exchange for a
like principal amount of Senior Debentures upon the consummation of a Registered
Exchange Offer and, if applicable, a Private Exchange pursuant to the
Registration Rights Agreement; in each case upon a written order of the Company,
as specified in Section 2.2(a) above. Such order shall specify (1) the amount of
the Securities to be authenticated and the date on which the original issue of
Securities is to be authenticated, (2) whether the Securities are to be Initial
Securities, Exchange Securities, or Private Exchange Securities, and (3)
delivery instructions for such Securities, including applicable CUSIP numbers.
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SECTION 2.3. TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Securities. (i) The transfer and
exchange of Global Securities or beneficial interests therein shall be effected
through the Depositary, in accordance with the Indenture and this Supplemental
Indenture (including all applicable restrictions on transfer set forth herein,
if any) and the procedures of the Depositary therefor. The transferor of a
beneficial interest in a Global Security shall deliver to the Security Registrar
a written order given in accordance with the Depositary's procedures containing
information regarding the participant accounts of the Depositary to be debited
and credited with such beneficial interest in the Global Security in connection
with such transfer. The Security Registrar shall, in accordance with such
instructions, instruct the Depositary to debit the participant account specified
in such instructions from which such beneficial interest in the Global Security
is to be transferred and to credit the participant account specified in such
instructions to which such beneficial interest in the Global Security is to be
transferred.
(ii) Notwithstanding any other provisions of this Supplemental
Indenture (other than the provisions set forth in Section 2.4), a Global
Security may not be transferred as a whole except (A) by the Depositary to
a nominee of the Depositary, (B) by a nominee of the Depositary to the
Depositary or another nominee of the Depositary, or (C) by the Depositary
or any such nominee to a successor Depositary or a nominee of such
successor Depositary.
(iii) In the event that a Global Security representing Transfer
Restricted Securities is exchanged for certificated Securities in
definitive registered form pursuant to Section 2.4 of this Supplemental
Indenture or Section 2.06 of the Indenture, such Transfer Restricted
Securities may be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.3 (including
the certification requirements set forth in Exhibit A intended to ensure
that such transfers comply with Rule 144A or Regulation S, as the case may
be) and such other procedures as may from time to time be adopted by the
Company.
(b) Legend.
(i) Except as permitted by the following paragraphs (ii), (iii)
and (iv), each certificate evidencing Securities shall bear a legend in
substantially the following form:
"THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THIS
SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS
SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION
5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
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THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED ONLY (i) INSIDE THE UNITED STATES TO
A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (ii) OUTSIDE THE UNITED STATES IN A TRANSACTION IN
ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (iii)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE)
OR (iv) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, IN EACH OF CASES (i) THROUGH (iv) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS
SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
ABOVE."
(ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security represented by a
Global Security) pursuant to Rule 144 under the Securities Act, the
Security Registrar shall permit the Holder thereof to exchange such
Transfer Restricted Security for a certificated Security that does not bear
the legend set forth above and rescind any restriction on the transfer of
such Transfer Restricted Security, if the Holder certifies in writing to
the Security Registrar that its request for such exchange was made in
reliance on Rule 144 (such certification to be in the form set forth on the
reverse of the Security).
(iii) After a transfer of any Initial Securities or Private
Exchange Securities during the period of the effectiveness of a Shelf
Registration Statement with respect to such Initial Securities or Private
Exchange Securities, as the case may be, all requirements pertaining to
legends on such Initial Securities or such Private Exchange Securities will
cease to apply, the requirements requiring such Initial Securities or such
Private Exchange Securities issued to certain Holders be issued in global
form will cease to apply, and certificated Initial Securities or Private
Exchange Securities that do not bear the legend set forth above will be
available to the transferee of the Holder of such Initial Securities or
Private Exchange Securities upon exchange of such transferring Holder's
certificated Initial Securities or Private Exchange Securities or
directions to transfer such Holder's interest in the Global Security, as
applicable.
(iv) Upon the consummation of a Registered Exchange Offer with
respect to the Initial Securities pursuant to which certain Holders of such
Initial Securities are offered Exchange Securities in exchange for their
Initial Securities, the requirements of Section 2.1(c) that Initial
Securities issued to certain Holders be issued in global form will cease to
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apply and, subject to the provisions of Section 2.4(a) of this Supplemental
Indenture, certificated Initial Securities that bear the legend set forth
above will be available to Holders of such Initial Securities that do not
exchange their Initial Securities, and Exchange Securities in certificated
or global form that do not bear the legend set forth above will be
available to Holders that exchange such Initial Securities in such
Registered Exchange Offer.
(v) Upon the consummation of a Private Exchange with respect to
the Initial Securities pursuant to which Holders of such Initial Securities
are offered Private Exchange Securities in exchange for their Initial
Securities, the requirements of Section 2.1(c) that Initial Securities
issued to certain Holders be issued in global form will still apply, and
Private Exchange Securities in global form that bear the legend set forth
above will be available to Holders that exchange such Initial Securities in
such Private Exchange.
(c) Cancellation or Adjustment of Global Security. At such time as
all beneficial interests in a Global Security have either been exchanged
for certificated Securities, redeemed, repurchased or canceled, such Global
Security shall be returned to the Depositary for cancellation or retained
and canceled by the Trustee. At any time prior to such cancellation, if any
beneficial interest in a Global Security is exchanged for certificated
Securities, redeemed, repurchased or canceled, the principal amount of
Securities represented by such Global Security shall be reduced and an
adjustment shall be made on the books and records of the Securities
Custodian for such Global Security to reflect such reduction.
(d) Obligations with Respect to Transfers and Exchanges of
Securities.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate certificated
Securities and Global Securities at the Security Registrar's or any
co-registrar's request.
(ii) No service charge shall be made for any registration of
transfer or exchange (other than any such transfer taxes, assessments or
similar governmental charge payable upon exchange or transfer pursuant to
Section 2.05 of the Indenture).
(iii) The Security Registrar or co-Security Registrar shall not
be required to register the transfer of or exchange of (A) any Securities
selected for redemption (except, in the case of a Security to be redeemed
in part, the portion of the Security not to be redeemed) or (B) any
Security for a period beginning 15 Business Days before the mailing of a
notice of an offer to repurchase or redeem such Securities or 15 Business
Days before an interest payment date.
(iv) Prior to the due presentation for registration of transfer
of any Security, the Company, the Trustee, the Paying Agent, the Security
Registrar or any co-Security Registrar may deem and treat the person in
whose name a Security is registered as the absolute owner of such Security
for the purpose of receiving payment of Principal of and interest on such
Security and for all other purposes whatsoever, whether or not such
Security is overdue, and none of the Company, the Trustee, the Paying
Agent, the Security Registrar or any co-Security Registrar shall be
affected by notice to the contrary.
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(v) All Securities issued upon any transfer or exchange
pursuant to the terms of this Supplemental Indenture shall evidence the
same debt and shall be entitled to the same benefits under this
Supplemental Indenture and the Indenture as the Securities surrendered upon
such transfer or exchange.
(e) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or obligation to
any beneficial owner of a Global Security, a member of, or a participant in
the Depositary or other Person with respect to the accuracy of the records
of the Depositary or its nominee or of any participant or member thereof,
with respect to any ownership interest in the Securities or with respect to
the delivery to any participant, member, beneficial owner or other Person
(other than the Depositary) of any notice (including any notice of
redemption) or the payment of any amount, under or with respect to such
Securities. All notices and communications to be given to the Holders and
all payments to be made to Holders under the Securities shall be given or
made only to or upon the written order of the registered Holders (which
shall be the Depositary or its nominee in the case of a Global Security).
The rights of beneficial owners in any Global Security shall be exercised
only through the Depositary subject to the applicable rules and procedures
of the Depositary. The Trustee may rely and shall be fully protected in
relying upon information furnished by the Depositary with respect to its
members, participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under the Indenture, this Supplemental Indenture or under
applicable law with respect to any transfer of any interest in any Security
(including any transfers between or among Depositary participants, members
or beneficial owners in any Global Security) other than to require delivery
of such certificates and other documentation or evidence as are expressly
required by, and to do so if and when expressly required by, the terms of
this Supplemental Indenture and the Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
SECTION 2.4. CERTIFICATED SECURITIES.
(a) A Global Security deposited with the Depositary or with the
Trustee as custodian for the Depositary pursuant to Section 2.1 shall be
transferred to the beneficial owners thereof in the form of certificated
Securities in an aggregate principal amount equal to the principal amount of
such Global Security, in exchange for such Global Security, only if such
transfer complies with Section 2.3 and (i) the Depositary notifies the Company
that it is unwilling or unable to continue as Depositary for such Global
Security or if at any time such Depositary ceases to be a "clearing agency"
registered under the Exchange Act and a successor depositary is not appointed by
the Company within 90 days of such notice, or (ii) an Event of Default has
occurred and is continuing or (iii) the Company executes and delivers to the
Trustee a Company Order that such Global Security shall be so transferable and
such transfers shall be registerable.
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(b) Any Global Security that is transferable to the beneficial
owners thereof pursuant to this Section 2.4 shall be surrendered by the
Depositary to the Trustee located in the Borough of Manhattan, The City of New
York, to be so transferred, in whole or from time to time in part, without
charge, and the Trustee shall authenticate and deliver, upon such transfer of
each portion of such Global Security, an equal aggregate principal amount of
certificated Securities of authorized denominations. Any portion of a Global
Security transferred pursuant to this Section shall be executed, authenticated
and delivered only in denominations of $1,000 and any integral multiple thereof
and registered in such names as the Depositary shall direct. Any certificated
Security delivered in exchange for an interest in the Global Security shall,
except as otherwise provided by Section 2.3(b), bear the restricted securities
legend set forth in Exhibit A hereto.
(c) Subject to the provisions of Section 2.4(b), the registered
Holder of a Global Security may grant proxies and otherwise authorize any
Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action that a Holder is entitled to take under the
Indenture or the Securities.
(d) In the event of the occurrence of any of the events specified in
Section 2.4(a), the Company will promptly make available to the Trustee a
reasonable supply of certificated Securities in definitive, fully registered
form without interest coupons.
SECTION 2.5. VOTING AND CONSENT RIGHTS
(a) The Senior Notes, the Exchange Notes and the Private Exchange
Notes shall constitute a single series of securities (as such term is defined in
the Indenture) and shall vote and consent together on all matters as one series
and none of the Senior Notes, the Exchange Notes or the Private Exchange Notes
shall have the right to vote or consent as a class or series separate from one
another on any matter, and (b) the Senior Debentures, the Exchange Debentures
and the Private Exchange Debentures shall constitute a single series of
securities (as such term is defined in the Indenture) and shall vote and consent
together on all matters as one series and none of the Senior Debentures, the
Exchange Debentures or the Private Exchange Debentures will have the right to
vote or consent as a class or series separate from one another on any matter.
ARTICLE III. CERTAIN COVENANTS.
The following covenants shall be applicable to the Company for so
long as any of the Securities are Outstanding. Nothing in this paragraph will,
however, affect the Company's rights or obligations under any other provision of
the Indenture or this Supplemental Indenture.
SECTION 3.1. LIENS.
The Company shall not, and shall not permit any Restricted
Subsidiary to, create, incur, assume, or suffer to exist any Liens upon any of
their respective assets, other than Permitted Liens, unless the Securities are
secured by an equal and ratable Lien on the same assets.
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SECTION 3.2. SALE AND LEASEBACK TRANSACTIONS.
The Company shall not, and shall not permit any Restricted
Subsidiary to, enter into any Sale and Leaseback Transaction unless the net cash
proceeds therefrom are applied as follows: to the extent that the aggregate
amount of net cash proceeds (net of all legal, title, and recording tax
expenses, commissions, and other fees and expenses incurred, and all federal,
state, provincial, foreign, and local or other taxes and reserves required to be
accrued as a liability, as a consequence of such Sale and Leaseback Transaction,
net of all payments made on any Indebtedness that is secured by the assets
subject to such Sale and Leaseback Transaction in accordance with the terms of
any Liens upon or with respect to such assets or which must by the terms of such
Lien, or in order to obtain a necessary consent to such Sale and Leaseback
Transaction or by applicable law be repaid out of the proceeds from such Sale
and Leaseback Transaction, and net of all distributions and other payments made
to minority interest holders in Subsidiaries or joint ventures as a result of
such Sale and Leaseback Transaction) from such Sale and Leaseback Transaction
that shall not have been reinvested in the business of the Company or its
Subsidiaries or used to reduce Senior Indebtedness of the Company or its
Subsidiaries within 12 months of the receipt of such proceeds (with Cash
Equivalents being deemed to be proceeds upon receipt of such Cash Equivalents
and cash payments under promissory notes secured by letters of credit or similar
assurances of payment issued by commercial banks of recognized standing being
deemed to be proceeds upon receipt of such payments) shall exceed $100.0 million
("Excess Sale Proceeds") from time to time, the Company shall offer to
repurchase pursuant to an Offer to Purchase Securities with such Excess Sale
Proceeds (on a pro rata basis with any other Senior Indebtedness of the Company
or its Subsidiaries required by the terms of such Indebtedness to be repurchased
with such Excess Sale Proceeds, based on the principal amount of such Senior
Indebtedness required to be repurchased) at 100% of principal amount, plus
accrued and unpaid interest, and to pay related costs and expenses. Such Offer
to Purchase shall be made by mailing a Notice to the Trustee and to each Holder
at the address appearing in the Security Register, by first class mail, postage
prepaid, by the Company or, at the Company's request, by the Trustee in the name
and at the expense of the Company, on a date selected by the Company not later
than 12 months from the date such Offer to Purchase is required to be made
pursuant to the immediately preceding sentence. To the extent that the aggregate
purchase price for Securities or other Senior Indebtedness tendered pursuant to
such offer to repurchase is less than the aggregate purchase price offered in
such offer, an amount of Excess Sale Proceeds equal to such shortfall shall
cease to be Excess Sale Proceeds and may thereafter be used for general
corporate purposes. On the Purchase Date, the Company shall (i) accept for
payment Securities or portions thereof tendered pursuant to the Offer to
Purchase in an aggregate principal amount equal to the Purchase Amount (selected
by such method as the Trustee shall deem fair and appropriate and which may
provide for the selection for purchase of portions (equal to $1,000 or an
integral multiple of $1,000) of the principal amount of Securities of a
denomination larger than $1,000), (ii) deposit with the Paying Agent money
sufficient to pay the purchase price of all Securities or portions thereof so
accepted, and (iii) deliver to the Trustee Securities so accepted. The Paying
Agent shall promptly mail to the Holders of Securities so accepted payment in an
amount equal to the purchase price, and the Trustee shall promptly authenticate
and mail to such Holders a new Security equal in principal amount to any
unpurchased portion of each Security surrendered.
Election of the Offer to Purchase by a Holder shall (unless
otherwise provided by law) be irrevocable. The payment of accrued interest as
part of any repurchase price on any
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Purchase Date shall be subject to the right of Holders of record on the relevant
Regular Record Date to receive interest due on an Interest Payment Date that is
on or prior to such Purchase Date.
If an Offer to Purchase Securities is made, the Company shall comply
with all tender offer rules, including but not limited to Section 14(e) of the
Exchange Act and Rule 14e-1 thereunder, to the extent applicable to such Offer
to Purchase.
SECTION 3.3. PERMITTING UNRESTRICTED SUBSIDIARIES TO BECOME RESTRICTED
SUBSIDIARIES .
The Company shall not permit any Unrestricted Subsidiary to be
designated as a Restricted Subsidiary unless such Subsidiary is otherwise in
compliance with all provisions of the Indenture and this Supplemental Indenture
that apply to Restricted Subsidiaries.
SECTION 3.4. PAYMENT OFFICE.
The Company shall cause a Payment Office for the Securities to be
maintained at all times in New York, New York.
ARTICLE IV. ADDITIONAL EVENTS OF DEFAULT.
SECTION 4.1. ADDITIONAL EVENTS OF DEFAULT.
In addition to the Events of Default set forth in the Indenture, the
term "Event of Default," whenever used in the Indenture or this Supplemental
Indenture with respect to a series of the Securities, means any one of the
following events (whatever the reason for such Event of Default and whether it
may be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree, or order of any court or any order, rule, or regulation
of any administrative or governmental body):
(a) the failure to redeem such Securities when required pursuant to
the terms and conditions thereof or to pay the repurchase price for such
Securities to be repurchased in accordance with Section 3.2 of this
Supplemental Indenture;
(b) any nonpayment at maturity or other default under any agreement
or instrument relating to any other Indebtedness of the Company or any
Restricted Subsidiary (the unpaid principal amount of which is not less
than $100.0 million), and, in any such case, such default (i) continues
beyond any period of grace provided with respect thereto and (ii) results
in such Indebtedness becoming due prior to its stated maturity or occurs
at the final maturity of such Indebtedness; provided, however, that,
subject to the provisions of Section 9.01 and 8.08 of the Indenture, the
Trustee shall not be deemed to have knowledge of such nonpayment or other
default unless either (1) a Responsible Officer of the Trustee has actual
knowledge of nonpayment or other default or (2) the Trustee has received
written notice thereof from the Company, from any Holder, from the holder
of any such Indebtedness or from the trustee under the agreement or
instrument, relating to such Indebtedness;
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(c) the entry of one or more final judgments or orders for the
payment of money against the Company or any Restricted Subsidiary, which
judgments and orders create a liability of $100.0 million or more in
excess of insured amounts and have not been stayed (by appeal or
otherwise), vacated, discharged, or otherwise satisfied within 60 calendar
days of the entry of such judgments and orders; and
(d) Events of Default of the type and subject to the conditions set
forth in clauses (vi) and (vii) of Section 8.01(a) of the Indenture in
respect of any Significant Subsidiary or, in related events, any group of
Subsidiaries which, if considered in the aggregate, would be a Significant
Subsidiary of the Company.
ARTICLE V. DEFEASANCE.
SECTION 5.1. APPLICABILITY OF ARTICLE V OF THE INDENTURE.
(a) The Securities of each series shall be subject to Defeasance and
Covenant Defeasance as provided in Article V of the Indenture; provided,
however, that no Defeasance or Covenant Defeasance shall be effective unless and
until:
(i) there shall have been delivered to the Trustee the
opinion of a nationally recognized independent public accounting firm
certifying the sufficiency of the amount of the moneys, U.S. Government
Obligations, or a combination thereof, placed on deposit to pay, without
regard to any reinvestment, the principal of and any premium and interest
on such Securities on the Stated Maturity thereof or on any earlier date
on which such Securities shall be subject to redemption;
(ii) there shall have been delivered to the Trustee the
certificate of a Responsible Officer of the Company certifying, on behalf
of the Company, to the effect that such Defeasance or Covenant Defeasance
shall not result in a breach or violation of, or constitute a default
under, any agreement to which the Company is a party or violate any law to
which the Company is subject; and
(iii) No Event of Default or event that (after notice or
lapse of time or both) would become an Event of Default shall have
occurred and be continuing at the time of such deposit or, with regard to
any Event of Default or any such event specified in Sections 8.01(a)(vi)
and (vii) of the Indenture, at any time on or prior to the 124th calendar
day after the date of such deposit (it being understood that this
condition shall not be deemed satisfied until after such 124th calendar
day).
(b) Upon the exercise of the option provided in Section 5.01 of the
Indenture to have Section 5.03 of the Indenture applied to the Outstanding
Securities of either series, in addition to the obligations from which the
Company shall be released specified in the Indenture, the Company shall be
released from its obligations under Article III hereof with respect to such
Securities.
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ARTICLE VI. REDEMPTION OF SECURITIES.
SECTION 6.1. RIGHT OF REDEMPTION.
The Securities may be redeemed by the Company in accordance with
provisions of the applicable form of Securities attached hereto.
ARTICLE VII. MISCELLANEOUS.
SECTION 7.1. REFERENCE TO AND EFFECT ON THE INDENTURE.
This Supplemental Indenture shall be construed as supplemental to
the Indenture and all the terms and conditions of this Supplemental Indenture
shall be deemed to be part of the terms and conditions of the Indenture. Except
as set forth herein, the Indenture heretofore executed and delivered is hereby
(i) incorporated by reference in this Supplemental Indenture and (ii) ratified,
approved, and confirmed.
SECTION 7.2. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to comply with any
term, provision, or condition set forth in Article III hereof with respect to
the Securities of either series if the Holders of a majority in principal amount
of the Outstanding Securities of such series shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such term, provision or condition, but no such waiver shall extend to or affect
such term, provision, or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Company
and the duties of the Trustee in respect of any such term, provision, or
condition shall remain in full force and effect.
SECTION 7.3. SUPPLEMENTAL INDENTURE MAY BE EXECUTED IN COUNTERPARTS.
This instrument may be executed in any number of counterparts, each
of which shall be an original; but such counterparts shall together constitute
but one and the same instrument.
SECTION 7.4. EFFECT OF HEADINGS.
The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year first above
written.
[Seal]
FEDERATED DEPARTMENT STORES, INC.
By: /s/ Xxxxx Xxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President, CFO
and Treasurer
Attest:
/s/ Xxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxx
Title: OVP and Assistant Treasurer
CITIBANK, N.A.,
as Trustee
By: /s/ X. Xxxx
-----------------------------------
Name: X. Xxxx
Title: Senior Trust Officer
Attest:
/s/ Xxxxx Xxxxx
-----------------------------------
Name: Xxxxx Xxxxx
Title: Trust Officer
24
22
STATE OF OHIO )
) ss.:
COUNTY OF XXXXXXXX )
On this 22nd day of March, 1999, before me personally came Xxxxx
Xxxxxx, to me known, who, being by me duly sworn, did depose and say that he/she
is a Senior Vice President/CFO of FEDERATED DEPARTMENT STORES, INC., one of the
entities described in and which executed the above instrument; that he/she knows
the seal of said entity; that the seal or a facsimile thereof affixed to said
instrument is such seal; that it was so affixed by authority of the Board of
Directors of said entity, and that he/she signed his/her name thereto by like
authority.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxx X. Xxxxxxx
--------------------------------
Notary Public
25
23
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this 23rd day of March, 1999, before me personally came X. Xxxx,
to me known, who, being by me duly sworn, did depose and say that he/she is a
Senior Trust Officer of CITIBANK, N.A., one of the entities described in and
which executed the above instrument; that he/she knows the seal of said entity;
that the seal or a facsimile thereof affixed to said instrument is such seal;
that it was so affixed by authority of the Board of Directors of said entity,
and that he/she signed his/her name thereto by like authority.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx Xxxxxx
--------------------------------
Notary Public
26
EXHIBIT A
[FORM OF FACE OF INITIAL SECURITIES]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Securities Legend]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE
SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS
SECURITY MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (i) INSIDE
THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (ii) OUTSIDE THE UNITED
STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(iii)
27
2
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE) OR (iv) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (i) THROUGH (iv) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.
28
Federated Department Stores, Inc.
No. __ Principal Amount $_____________
CUSIP NO. _________
[6.30% Senior Note Due 2009]
[6.90% Senior Debenture Due 2029]
Federated Department Stores, Inc., a Delaware corporation, promises
to pay to Cede & Co., or registered assigns, the principal sum of
________________________ Dollars on April 1, [2009] [2029].
Interest Payment Dates: April 1 and October 1.
Record Dates: March 15 and September 15.
Additional provisions of this Security are set forth on the other
side of this Security.
Dated: _______ __, ____ FEDERATED DEPARTMENT STORES, INC.
By:
---------------------------------------------------------------------
Attest:
-----------------------------------------------------------------
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
Dated: ________ __, ____
CITIBANK, N.A.
as Trustee, certifies that
this is one of the Securities
referred to in the Indenture,
as supplemented by the
Supplemental Indenture
related to these Securities.
By:
----------------------------------
Authorized Signatory
29
[FORM OF REVERSE SIDE OF INITIAL SECURITIES]
(Reverse of Security)
[6.30% Senior Note Due 2009]
[6.90% Senior Debenture Due 2029]
1. Interest
Federated Department Stores, Inc., a corporation duly organized and
existing under the laws of the State of Delaware (hereinafter called the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to Cede &
Co., or registered assigns, the principal sum of $ on April 1, [2009] [2029] and
to pay interest thereon from March 24, 1999 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, semiannually
on April 1 and October 1 of each year, commencing on October 1, 1999 at the rate
per annum shown above, until the principal hereof is paid or made available for
payment; provided, however, that if a Registration Default (as defined in the
Registration Rights Agreement) occurs, additional cash interest will accrue on
this Security at a rate of 0.50% per annum (regardless of the number of
Registration Defaults) from and including the date on which any such
Registration Default shall occur (subject to the terms of the Registration
Rights Agreement) to but excluding the date on which all Registration Defaults
have been cured. Such interest is calculated on the principal amount of this
Security as of the date on which such interest is payable. Such interest is
payable in addition to any other interest payable from time to time with respect
to this Security. The Trustee will not be deemed to have notice of a
Registration Default until it shall have received actual notice of such
Registration Default.
The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date shall, as provided in said Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest, which shall be the March 15 or September 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for shall forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not less than 10 calendar days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Securities of this series may be listed, and upon such notice as may
be required by such exchange, all as more fully provided in said Indenture.
30
2
2. Method of Payment
Subject in the case of any Global Security to any applicable
requirements of the Depositary, the payment of the principal of and any such
interest on this Security shall be made at the office or agency of the Company
maintained for the purpose in New York, New York, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts; provided, however, that at the option of
the Company payment of interest may be made by check mailed to the address of
the Person entitled thereto as such address appears in the Security Register.
3. Indenture
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities") issued and to be issued in one or more
series under an Indenture, dated as of September 10, 1997 (herein called the
"Indenture"), between the Company and Citibank, N.A. as Trustee (herein called
the "Trustee," which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights, duties,
and immunities thereunder of the Company, the Trustee, and the Holders of the
Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof, limited in aggregate principal amount to [$350,000,000]
[$400,000,000].
The Securities are senior unsecured obligations of the Company. The
Initial Securities issued on the Closing Date and all Exchange Securities or
Private Exchange Securities issued in exchange therefor will be treated as a
single series for all purposes under the Indenture.
4. Redemption
The Securities are redeemable in whole or in part, at the option of the
Company at any time and from time to time, on not less than 30 or more than 60
days' prior notice mailed to the Holders of the Securities, at a Redemption
Price equal to the greater of (i) 100% of the principal amount of the Securities
to be redeemed and (ii) the sum of the present values of the Remaining Scheduled
Payments thereon discounted to the Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus [20][25] basis points, together in either case with accrued interest
on the principal amount being redeemed to the Redemption Date.
"Treasury Rate" means, with respect to any Redemption Date, the rate
per annum equal to the semiannual equivalent yield to maturity (computed as of
the second business day immediately preceding such Redemption Date) of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable
31
3
maturity to the remaining term of the Securities. "Independent Investment
Banker" means one of the Reference Treasury Dealers appointed by the Company.
"Comparable Treasury Price" means, with respect to any Redemption
Date, (i) the average of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) on the
third business day preceding such Redemption Date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such business day, (a) the average
of the Reference Treasury Dealer Quotations for such Redemption Date, after
excluding the highest and lowest of such Reference Treasury Dealer Quotations,
or (b) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Quotations. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
Redemption Date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its principal amount) quoted in writing to the Trustee by such Reference
Treasury Dealer as of 3:30 p.m., New York City time, on the third Business Day
preceding such Redemption Date.
"Reference Treasury Dealer" means each of Credit Suisse First Boston
Corporation, Xxxxxxx Xxxxx Barney Inc., Chase Securities Inc., NationsBanc
Xxxxxxxxxx Securities LLC and PNC Capital Markets, Inc. and their respective
successors and two other nationally recognized investment banking firms that are
Primary Treasury Dealers specified form time to time by the Company; provided,
however, that if any of the foregoing shall cease to be a primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer"), the
Company shall designate as a substitute another nationally recognized investment
banking firm that is a Primary Treasury Dealer.
"Remaining Scheduled Payments" means, with respect to each Security
to be redeemed, the remaining scheduled payments of the principal thereof and
interest thereon that would be due after the related Redemption Date but for
such redemption, except that, if such Redemption Date is not an interest payment
date with respect to such Security, the amount of the next succeeding scheduled
interest payment thereon shall be reduced by the amount of interest accrued
thereon to such Redemption Date.
On and after any Redemption Date, interest will cease to accrue on
the Securities or any portion thereof called for redemption. Prior to any
Redemption Date, the Company shall deposit with a paying agent money sufficient
to pay the Redemption Price of and accrued interest on the Securities to be
redeemed on such date. If less than all the Securities are to be redeemed, the
Securities to be redeemed shall be selected by the Trustee by such method as the
Trustee shall deem fair and appropriate in accordance with methods generally
used at the time of selection by fiduciaries in similar circumstances.
32
4
5. Registration Rights; Holders' Compliance
The Company is party to a Registration Rights Agreement, dated as of
March 18, 1999, among the Company, Credit Suisse First Boston Corporation,
Xxxxxxx Xxxxx Xxxxxx Inc., Xxxxx Securities Inc., NationsBanc Xxxxxxxxxx
Securities LLC and PNC Capital Markets, Inc. pursuant to which it is obligated
to pay Additional Interest upon the occurrence of certain Registration Defaults
(as defined therein).
Each Holder of a Security, by acceptance, hereof, acknowledges and
agrees to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.
6. Amendment, Waiver
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
7. Defaults and Remedies
This Security is subject to the provisions of the Indenture which
provide for defeasance at any time of (a) the entire indebtedness of this
Security or (b) certain restrictive covenants and Events of Default with respect
to this Security, in each case upon compliance with certain conditions set forth
in the Indenture.
If an Event of Default with respect to Securities of this series
shall occur and be continuing, the principal of the Securities of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request
33
5
and shall have failed to institute such proceeding for 60 calendar days after
receipt of such notice, request, and offer of indemnity. The foregoing shall
apply to any suit instituted by the Holder of this Security for the enforcement
of any payment of principal hereof or any premium or interest hereon on or after
the respective due dates expressed herein.
8. Obligation Absolute
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place, and rate, and in the
coin or currency, herein prescribed.
9. Denominations; Transfer; Exchange
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registerable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his or
her attorney duly authorized in writing, and thereupon one or more new
Securities of this series and of like tenor, of authorized denominations and for
the same aggregate principal amount, shall be issued to the designated
transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and integral multiples thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
10. Persons Deemed Owners
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee, and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security shall be overdue, and
neither the Company, the Trustee, nor any such agent shall be affected by notice
to the contrary.
Unless this Security is presented by an authorized representative of
The Depositary Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the
Company or its agent for registration of transfer, exchange, or payment, and any
Security issued upon registration of transfer of, or in exchange for or in lieu
of, this Security is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depositary Trust Company and
payment hereon
34
6
is made to Cede & Co., ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL because the registered owner hereof,
Cede & Co., has an interest herein.
11. Defined Terms
All terms used in this Security that are defined in the Indenture
shall have the respective meanings assigned to them in the Indenture.
35
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the
books of the Company. The agent may substitute another to act for him.
--------------------------------------------------------------------------------
Date: ____________________ Your Signature: ___________________
Signature Guarantee: ______________________________
(Signature must be guaranteed)
--------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
In connection with any transfer or exchange of any of the Securities evidenced
by this certificate occurring prior to the expiration of the period referred to
in Rule 144(k) under the Securities Act after the later of the date of original
issuance of such Securities and the last date, if any, on which such Securities
were owned by the Company or any Affiliate of the Company, the undersigned
confirms that such Securities are being transferred in accordance with their
terms:
CHECK ONE BOX BELOW:
(1) [ ] to the Company; or
(2) [ ] pursuant to an effective registration statement under the
Securities Act of 1933; or
(3) [ ] inside the United States to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities Act of 1933) that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that such transfer
is being made in reliance on Rule 144A, in each case pursuant
to and in compliance with Rule 144A under the Securities Act of
1933; or
(4) [ ] outside the United States in an offshore transaction within the
meaning of Regulation S under the Securities Act in compliance
with Rule 904 under the Securities Act of 1933; or
36
2
(5) [ ] pursuant to the exemption from registration provided by
Rule 144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any Person other
than the registered holder thereof; provided, however, that if box (4) or (5) is
checked, the Trustee may require, prior to registering any such transfer of the
Securities, such legal opinions, certifications and other information as the
Company has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933.
------------------------------
Signature
Signature Guarantee:
------------------------- ------------------------------
Signature
Signature must be guaranteed
------------------------------------------------------------
37
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated:
---------------- --------------------------------
NOTICE: To be executed by
an executive officer
38
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have
been made:
Principal Amount of Signature of
Amount of decrease in Amount of increase in this Global Security authorized officer of
Date of Principal Amount of Principal Amount of following such Trustee or Securities
Exchange this Global Security this Global Security decrease or increase Custodian
39
1
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Security purchased by the Company
pursuant to Section 3.2 of the Third Supplemental Indenture; check the box:
[ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 3.2 of the Third Supplemental Indenture, state
the amount in principal amount: $
Date: Your Signature:
-------------------- -------------------
Signature Guarantee: ______________________________
(Signature must be guaranteed)
40
EXHIBIT B
[FORM OF FACE OF EXCHANGE SECURITY [OR PRIVATE
EXCHANGE SECURITY]]
*
**
Federated Department Stores, Inc.
No. __ Principal Amount $_____________
CUSIP NO. _________
[6.30% Senior Note Due 2009]
[6.90% Senior Debenture Due 2029]
Federated Department Stores, Inc., a Delaware corporation, promises
to pay to Cede & Co., or registered assigns, the principal sum of
________________________ Dollars on April 1, [2009] [2029].
Interest Payment Dates: April 1 and October 1.
Record Dates: March 15 and September 15.
Additional provisions of this Security are set forth on the other
side of this Security.
Dated: _______ __, ____ FEDERATED DEPARTMENT STORES, INC.
By:
--------------------------------------
--------------------
* [If the Security is to be issued in global form add the Global
Securities Legend from Exhibit A and the attachment from such Exhibit A
captioned "[TO BE ATTACHED TO GLOBAL SECURITIES] - SCHEDULE OF
INCREASES OR DECREASES IN GLOBAL SECURITY".]
** [If the Security is a Private Exchange Security issued in a Private
Exchange to an Initial Purchaser holding an unsold portion of its
initial allotment, add the Restricted Securities Legend from Exhibit A
and replace the Assignment Form with that included in such Exhibit A.]
41
2
Attest:
----------------------------
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
Dated: _______ __, ____
CITIBANK, N.A.
as Trustee, certifies that
this is one of the Securities
referred to in the Indenture,
as supplemented by the
Supplemental Indenture
related to these Securities.
By:
--------------------------------
Authorized Signatory
42
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY [OR
PRIVATE EXCHANGE SECURITY]]
[__% Senior Note Due 2009]
[__% Senior Debenture Due 2029]
1. Interest
Federated Department Stores, Inc., a corporation duly organized and
existing under the laws of the State of Delaware (hereinafter called the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to Cede &
Co., or registered assigns, the principal sum of $ on April 1, [2009] [2029] and
to pay interest thereon from March 24, 1999 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, semiannually
on April 1 and October 1 of each year, commencing on October 1, 1999 at the rate
per annum shown above, until the principal hereof is paid or made available for
payment [; provided, however, that if a Registration Default (as defined in the
Registration Rights Agreement) occurs, additional cash interest will accrue on
this Security at a rate of 0.50% per annum (regardless of the number of
Registration Defaults) from and including the date on which any such
Registration Default shall occur (subject to the terms of the Registration
Rights Agreement) to but excluding the date on which all Registration Defaults
have been cured. Such interest is calculated on the principal amount of this
Security as of the date on which such interest is payable. Such interest is
payable in addition to any other interest payable from time to time with respect
to this Security. The Trustee will not be deemed to have notice of a
Registration Default until it shall have received actual notice of such
Registration Default.]***
The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date shall, as provided in said Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest, which shall be the March 15 or September 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for shall forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not less than 10 calendar days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Securities of this series may be listed, and upon such notice as may
be required by such exchange, all as more fully provided in said Indenture.
------------------------------
*** Insert only on Private Exchange Security prior to satisfaction of all
registration obligations with respect to such Private Exchange
Security.
43
2
2. Method of Payment
Subject in the case of any Global Security to any applicable
requirements of the Depositary, the payment of the principal of and any such
interest on this Security shall be made at the office or agency of the Company
maintained for the purpose in New York, New York, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts; provided, however, that at the option of
the Company payment of interest may be made by check mailed to the address of
the Person entitled thereto as such address appears in the Security Register.
3. Indenture
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities") issued and to be issued in one or more
series under an Indenture, dated as of September 10, 1997 (herein called the
"Indenture"), between the Company and Citibank, N.A. as Trustee (herein called
the "Trustee," which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights, duties,
and immunities thereunder of the Company, the Trustee, and the Holders of the
Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof, limited in aggregate principal amount to [$350,000,000]
[$400,000,000].
The Securities are senior unsecured obligations of the Company. The
Initial Securities issued on the Closing Date and all Exchange Securities or
Private Exchange Securities issued in exchange therefor will be treated as a
single series for all purposes under the Indenture.
4. Redemption
The Securities are redeemable in whole or in part, at the option of
the Company at any time and from time to time, on not less than 30 or more than
60 days' prior notice mailed to the Holders of the Securities, at a Redemption
Price equal to the greater of (i) 100% of the principal amount of the Securities
to be redeemed and (ii) the sum of the present values of the Remaining Scheduled
Payments thereon discounted to the Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus [20][25] basis points, together in either case with accrued interest
on the principal amount being redeemed to the Redemption Date.
"Treasury Rate" means, with respect to any Redemption Date, the rate
per annum equal to the semiannual equivalent yield to maturity (computed as of
the second business day immediately preceding such Redemption Date) of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker that would be utilized, at
the time of selection and in accordance
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with customary financial practice, in pricing new issues of corporate debt
securities of comparable maturity to the remaining term of the Securities.
"Independent Investment Banker" means one of the Reference Treasury Dealers
appointed by the Company.
"Comparable Treasury Price" means, with respect to any Redemption
Date, (i) the average of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) on the
third business day preceding such Redemption Date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such business day, (a) the average
of the Reference Treasury Dealer Quotations for such Redemption Date, after
excluding the highest and lowest of such Reference Treasury Dealer Quotations,
or (b) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Quotations. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
Redemption Date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its principal amount) quoted in writing to the Trustee by such Reference
Treasury Dealer as of 3:30 p.m., New York City time, on the third Business Day
preceding such Redemption Date.
"Reference Treasury Dealer" means each of Credit Suisse First Boston
Corporation, Xxxxxxx Xxxxx Xxxxxx Inc., Xxxxx Securities Inc., NationsBanc
Xxxxxxxxxx Securities LLC and PNC Capital Markets, Inc. and their respective
successors and two other nationally recognized investment banking firms that are
Primary Treasury Dealers specified form time to time by the Company; provided,
however, that if any of the foregoing shall cease to be a primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer"), the
Company shall designate as a substitute another nationally recognized investment
banking firm that is a Primary Treasury Dealer.
"Remaining Scheduled Payments" means, with respect to each Security
to be redeemed, the remaining scheduled payments of the principal thereof and
interest thereon that would be due after the related Redemption Date but for
such redemption, except that, if such Redemption Date is not an interest payment
date with respect to such Security, the amount of the next succeeding scheduled
interest payment thereon shall be reduced by the amount of interest accrued
thereon to such Redemption Date.
On and after any Redemption Date, interest will cease to accrue on
the Securities or any portion thereof called for redemption. Prior to any
Redemption Date, the Company shall deposit with a paying agent money sufficient
to pay the Redemption Price of and accrued interest on the Securities to be
redeemed on such date. If less than all the Securities are to be redeemed, the
Securities to be redeemed shall be selected by the Trustee by such method as the
Trustee shall deem fair and appropriate in accordance with methods generally
used at the time of selection by fiduciaries in similar circumstances.
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5. Registration Rights; Holders' Compliance****
The Company is party to a Registration Rights Agreement, dated as of
March 18, 1999, among the Company, Credit Suisse First Boston Corporation,
Xxxxxxx Xxxxx Xxxxxx Inc., Xxxxx Securities Inc., NationsBanc Xxxxxxxxxx
Securities LLC and PNC Capital Markets, Inc. pursuant to which it is obligated
to pay Additional Interest upon the occurrence of certain Registration Defaults
(as defined therein).
Each Holder of a Security, by acceptance, hereof, acknowledges and
agrees to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.
6. Amendment, Waiver
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
7. Defaults and Remedies
This Security is subject to the provisions of the Indenture which
provides defeasance at any time of (a) the entire indebtedness of this Security
or (b) certain restrictive covenants and Events of Default with respect to this
Security, in each case upon compliance with certain conditions set forth in the
Indenture.
If an Event of Default with respect to Securities of this series
shall occur and be continuing, the principal of the Securities of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder unless such Holder shall
---------------------------
**** If all registration obligations with respect to the applicable Exchange
Securities or Private Exchange Securities have been satisfied, this Section 5
shall be deleted.
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have previously given the Trustee written notice of a continuing Event of
Default with respect to the Securities of this series, the Holders of not less
than 25% in principal amount of the Securities of this series at the time
Outstanding shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default as Trustee and offered the
Trustee reasonable indemnity, and the Trustee shall not have received from the
Holders of a majority in principal amount of Securities of this series at the
time Outstanding a direction inconsistent with such request and shall have
failed to institute such proceeding for 60 calendar days after receipt of such
notice, request, and offer of indemnity. The foregoing shall apply to any suit
instituted by the Holder of this Security for the enforcement of any payment of
principal hereof or any premium or interest hereon on or after the respective
due dates expressed herein.
8. Obligations Absolute
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place, and rate, and in the
coin or currency, herein provided.
9. Denominations; Transfer; Exchange
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registerable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his or
her attorney duly authorized in writing, and thereupon one or more new
Securities of this series and of like tenor, of authorized denominations and for
the same aggregate principal amounts shall be issued to the designated
transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and integral multiples thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
10. Persons Deemed Owners
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee, and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security shall be overdue, and
neither the Company, the Trustee, nor any such agent shall be affected by notice
to the contrary.
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Unless this Security is presented by an authorized representative of
The Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the
Company or its agent for registration of transfer, exchange or payment, and any
Security issued upon registration of transfer of, or is exchange for or in lieu
of, this Security is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL because the registered
owner hereof, Cede & Co., has an interest herein.
11. Defined Terms
All terms used in this Security that are defined in the Indenture
shall have the respective meanings assigned to them in the Indenture.
48
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the
books of the Company. The agent may substitute another to act for him.
--------------------------------------------------------------------------------
Date: Your Signature:
-------------------- -------------------
Signature Guarantee: ______________________________
(Signature must be guaranteed)
Sign exactly as your name appears on the other side of this Security.
[Include the following if it is a Private Exchange Security:]
In connection with any transfer or exchange of any of the Securities evidenced
by this certificate occurring prior to the expiration of the period referred to
in Rule 144(k) under the Securities Act after the later of the date of original
issuance of such Securities and the last date, if any, on which such Securities
were owned by the Company or any Affiliate of the Company, the undersigned
confirms that such Securities are being transferred in accordance with their
terms:
CHECK ONE BOX BELOW:
(1) [ ] to the Company; or
(2) [ ] pursuant to an effective registration statement under the
Securities Act of 1933; or
(3) [ ] inside the United States to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities Act of 1933) that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that such transfer
is being made in reliance on Rule 144A, in each case pursuant
to and in compliance with Rule 144A under the Securities Act of
1933; or
(4) [ ] outside the United States in an offshore transaction within the
meaning of Regulation S under the Securities Act in compliance
with Rule 904 under the Securities Act of 1933; or
49
2
(5) [ ] pursuant to the exemption from registration provided by
Rule 144 under the Securities act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any Person other
than the registered holder thereof; provided, however, that if box (4) or (5) is
checked, the Trustee may require, prior to registering any such transfer of the
Securities, such legal opinions, certifications and other information as the
Company has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933.
------------------------------
Signature
Signature Guarantee:
------------------------- ------------------------------
Signature
Signature must be guaranteed
---------------------------------------------------------
50
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated:
---------------- -------------------------------------
NOTICE: To be executed by
an executive officer
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have
been made:
Principal Amount of Signature of
Amount of decrease in Amount of increase in this Global Security authorized officer of
Date of Principal Amount of Principal Amount of following such Trustee or Securities
Exchange this Global Security this Global Security decrease or increase Custodian
52
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 3.2 of the Third supplemental Indenture; check the box:
[ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 3.2 of the Third Supplemental Indenture, state
the amount in principal amount: $
Date: Your Signature:
-------------------- -------------------
Signature Guarantee: ______________________________
(Signature must be guaranteed)
