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Federated to Submit Board Declassification to Shareholders

From: ASAP

Comments

Federated Department Stores, Inc. (NYSE:FD) (PCX:FD) said today that in May 2005 its board of directors intends to submit to shareholders a binding proposal to amend Federated's certificate of incorporation and bylaws to declassify its board of directors.

The company's current certificate of incorporation and bylaws divide the board into three classes, with directors elected to staggered three-year terms. If the new proposal is approved by a majority vote of shareholders, at the expiration of his or her current term each director will stand for election to a one-year term at each annual meeting of stockholders, beginning with the company's May 2006 annual meeting. The proposed amendments won't shorten the current term of any director now serving on the Federated board.

A non-binding shareholder proposal to declassify the board received a majority vote at the company's 2003 annual meeting. The board believes that submitting the declassification proposal to a binding vote of the company's shareholders is the appropriate response to that vote, and is in keeping with the company's commitment to good corporate governance.

Federated, with corporate offices in Cincinnati and New York, is one of the nation's leading department store retailers, with annual sales of more than $15.2 billion. Federated operates more than 450 stores in 34 states, Guam and Puerto Rico under the names of Macy's, Bloomingdale's, Bon-Macy's, Burdines-Macy's, Goldsmith's-Macy's, Lazarus-Macy's and Rich's-Macy's. The company also operates macys.com and Bloomingdale's By Mail. http://www.fds.com

This release contains certain forward-looking statements that reflect current views of the financial performance and future events of Federated. The words "expect," "plan," "think," "believe" and other similar expressions identify forward-looking statements. Any such forward-looking statements are subject to risks and uncertainties. Future results of the operations of Federated could differ materially from historical results or current expectations because of a variety of factors that affect the company, including transaction costs associated with the renovation, conversion and transitioning of company retail stores in regional markets; the outcome and timing of sales and leasing in conjunction with the disposition of company retail store properties; the retention, reintegration and transitioning of displaced company employees; competitive pressures from department and specialty stores, general merchandise stores, manufacturers' outlets, off-price and discount stores, and all other retail channels; and general consumer-spending levels, including the impact of the availability and level of consumer debt, and the effects of weather and other factors identified in documents filed by the company with the SEC.

November 2004

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