DILLARD'S, INC.
("Company")
Capital Securities
TERMS AGREEMENT
August 5, 1998
Dillard's, Inc.
1600 Cantrell Road
Little Rock, Arkansas 72201
Attention: Vice President and Treasurer
Dillard's Capital Trust I
c/o The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Corporate Trust Administration
Dear Sirs:
On behalf of the several Underwriters named in Schedule
A hereto and for their respective accounts, we offer to purchase,
on and subject to the terms and conditions of the Underwriting
Agreement Basic Provisions filed as an exhibit to the Company's
registration statement on Form S-3 (No. 333-59183) ("Underwriting
Agreement"), the following securities ("Securities") to be issued
under a subordinated indenture, dated as of August 7, 1998,
between the Company and The Chase Manhattan Bank, as Trustee, on
the following terms:
Designation of the Series of Capital Securities: 7.50%
Capital Securities
Issuer Trust: Dillard's Capital Trust I
Aggregate Number of Capital Securities: 8,000,000
Price to Public: $25 per share
Underwriters' Compensation per Capital Security: $.7875
Purchase Price: 100% of the principal amount of the
Securities, plus accrued interest from August 12, 1998, if any
Expected Reoffering Price: 100% of the principal amount of
the Securities, plus accrued interest from August 12, 1998, if
any
Closing Date: 10:00 A.M. on August 12, 1998, at the offices
of Simpson Thacher & Bartlett, 425 Lexington Avenue, New York,
New York 10017
Name and Address of Representatives:
Morgan Stanley & Co. Incorporated
1585 Broadway, Second Floor
New York, New York 10036
The respective principal amounts of the Securities to be
purchased by each of the Underwriters are set forth opposite
their names in Schedule A hereto.
It is understood that we may, with your consent, amend this offer
to add additional Underwriters and reduce the aggregate principal
amount to be purchased by the Underwriters listed in Schedule A
hereto by the aggregate principal amount to be purchased by such
additional Underwriters.
Form: Book-entry
The provisions of the Underwriting Agreement are
incorporated herein by reference
The Securities will be made available for checking and
packaging at the office of Morgan Stanley & Co. Incorporated at
least 24 hours prior to the Closing Date.
Please signify your acceptance of our offer by signing
the enclosed response to us in the space provided and returning
it to us.
Very truly yours,
MORGAN STANLEY & CO. INCORPORATED
On behalf of themselves and as
Representatives of the Several
Underwriters
By Morgan Stanley & Co. Incorporated
By
Name:
Title:
SCHEDULE A
Principal
Underwriter Amount
Morgan Stanley & Co. Incorporated 911,600
Merrill Lynch, Pierce, Fenner &
Smith Incorporated 911,400
NationsBanc Montgomery Securities LLC 911,400
PaineWebber Incorporated 911,400
Prudential Securities Incorporated 911,400
Smith Barney Inc. 911,400
Stephens Inc. 911,400
BT Alex Brown Incorporated 60,000
Bear, Stearns & Co. Inc. 60,000
CIBC Oppenheimer Corp. 60,000
A.G. Edwards & Sons, Inc. 60,000
Goldman, Sachs & Co. 60,000
Lehman Brothers Inc. 60,000
Morgan Keegan & Company, Inc. 60,000
Schroder & Co. Inc. 60,000
SG Cowen Securities Corporation 60,000
Advest, Inc. 30,000
Robert W. Baird & Co. Incorporated 30,000
William Blair & Company, L.L.C. 30,000
Blaylock & Partners, L.P. 30,000
J.C. Bradford & Co. 30,000
Craigie Incorporated 30,000
Crowell, Weedon & Co. 30,000
Dain Rauscher Incorporated 30,000
Davenport & Company LLC 30,000
Doley Securities, Inc. 30,000
Fahnestock & Co. Inc. 30,000
Ferris, Baker Watts, Incorporated 30,000
Fidelity Capital Markets, A Division
of National Financial Services Corporation 30,000
Fifth Third/The Ohio Company 30,000
First Albany Corporation 30,000
First of Michigan Corporation 30,000
Gibraltar Securities Co. 30,000
J.J.B. Hilliard, W.L. Lyons, Inc. 30,000
Interstate/Johnson Lane Corporation 30,000
Janney Montgomery Scott Inc. 30,000
Principal
Underwriter Amount
Kirkpatrick, Pettis, Smith, Polian Inc. 30,000
Legg Mason Wood Walker, Incorporated 30,000
McDonald & Company Securities, Inc. 30,000
Mesirow Financial, Inc. 30,000
Olde Discount Corporation 30,000
Pershing Division of
Donaldson, Lufkin & Jenrette
Securities Corporation 30,000
Piper Jaffray Inc. 30,000
Raymond James & Associates, Inc. 30,000
The Robinson-Humphrey Company, LLC 30,000
Roney Capital Markets
A Division of First Chicago
Capital Markets, Inc. 30,000
Scott & Stringfellow, Inc. 30,000
Sterne, Agee & Leach, Inc. 30,000
Stifel, Nicolaus & Company, Incorporated 30,000
Tucker Anthony Incorporated 30,000
Wedbush Morgan Securities 30,000
Wheat First Securities, Inc. 30,000
Total. . . . . . . . . . . . . . . . . . . . . . 8,000,000
=========
To: Morgan Stanley & Co. Incorporated
As Representatives of the Several
Underwriters,
c/o Morgan Stanley & Co. Incorporated
1585 Broadway, Second Floor
New York, New York 10036
We accept the offer contained in your letter, dated
August 5, 1998, relating to $200,000,000 principal amount of
our 7.50% Capital Securities. We also confirm that, to the
best of our knowledge after reasonable investigation, the
representations and warranties of the undersigned in the
Underwriting Agreement filed as an exhibit to the undersigned's
registration statement on Form S-3 (No. 333-59183)
("Underwriting Agreement") are true and correct, no stop order
suspending the effectiveness of the Registration Statement (as
defined in the Underwriting Agreement) or of any part thereof
has been issued and no proceedings for that purpose have been
instituted or, to the knowledge of the undersigned, are
contemplated by the Securities and Exchange Commission and,
subsequent to the respective dates of the most recent financial
statements in the Prospectus (as defined in the Underwriting
Agreement), there has been (or in the case of a form of
prospectus filed pursuant to Rule 424(b)(2) or (5) there will
be, as of the date of such prospectus) no material adverse
change in the financial position or results of operations of
the undersigned and its subsidiaries except as set forth in or
contemplated by the Prospectus.
Very truly yours,
DILLARD'S CAPITAL TRUST I
By: Dillard's, Inc., as Depositor
By
Name:
Title:
DILLARD'S, INC.
By
Name:
Title: