On May 19, 2006, the Macy's, Inc. board of directors approved a two-for-one stock split of Macy's, Inc. common stock. The split is structured in the form of a 100% stock dividend, payable June 9, 2006 to shareholders of record on May 26, 2006. As a result of the stock split, each shareholder will receive one additional share of common stock for each share of common stock owned as of the close of business on the record date. To assist our shareholders in their understanding of the stock split, we have provided answers to the following frequently asked questions:

For a PDF version of this FAQ, click here.

For the press release, click here.

What is a two-for-one stock split in the form of a 100% stock dividend?
A 100% stock dividend is a common way to implement a two-for-one stock split. On the payment date, June 9, 2006, each stockholder will receive one additional share of stock for each share owned as of the close of business on the record date, May 26, 2006. Since there will be twice as many shares after the split, each share will be worth half of what it was worth immediately prior to the split, while the overall value of a stockholder's investment remains the same.

The difference between a stock split in the form of a dividend and a stock split not in the form of a dividend is that the shares will continue to trade under the same CUSIP number.

How many shares will I receive?
A 2-for-1 split means the investor will have twice as many shares as he or she had on the close of business on the record date, at half the market price per share. Here's an example: If an investor owns 100 shares of FD as of the record date and the market price is $74.00/share, that investor's total value is $7,400.00. After the split, the investor will have a total of 200 shares of stock, but the market price will be $37.00/share. The investor's total investment value in FD remains the same at $7,400.00 until the stock price moves up or down.

What and when are the key dates for the stock split?
Record Date - May 26, 2006: This date exists to determine which shareholders are entitled to receive additional shares due to the split.

Ex-Date for the stock split - June 12, 2006: This is the date when Macy's, Inc. common shares will trade on NYSE at the new split-adjusted price, reflecting the doubling of the number of outstanding shares.

Can I view my Bank of New York account online?
Yes. Please log on to www.stockbny.com and click on the "Log In" link in the "Shareholder Account Access" section to get started.

How are shares from the stock split credited to my brokerage account?
If you hold Macy's, Inc. common stock in a brokerage account, the additional shares will be sent directly to your broker for credit to your brokerage account. Please contact your broker directly for an account statement reflecting the additional shares credited to your account as a result of the split, or with any questions regarding your brokerage account.

Why is the company splitting the stock?
These actions reflect our confidence in the future operating results and cash flow of the company, as well as our ongoing determination to build long-term shareholder value

Does the two-for-one stock split in the form of a 100 percent stock dividend dilute the value of my Macy's, Inc. stock holdings by increasing the number of shares?
No, this stock split will not change the proportionate interest a stockholder maintains in Macy's, Inc. (e.g. a person owning 1 percent of Macy's, Inc. common stock before the split will continue to own 1 percent of Macy's, Inc. stock after the split).

Do I have to pay for the shares?
There is no cost to you in connection with the stock split.

Has Macy's, Inc. previously split the stock?
This will be the first stock split since Macy's, Inc. was listed in its current form on the New York Stock Exchange in February 1992.

Will the par value change?
No. The par value will remain at $0.01 per share.

What will happen to the dividend?
With the stock split, Macy's, Inc.'s quarterly dividend will be 12.75 cents per outstanding common share, payable July 3, 2006, to Macy's, Inc. shareholders of record at the close of business on June 16, 2006.

Do I have to pay taxes on the new shares? What happens to my cost basis in my old shares?
No. You will not have to pay taxes on your receipt of your new shares. Macy's, Inc.'s distribution of the new shares to you pursuant to the stock split is considered to be a nontaxable stock distribution for U.S. Federal income tax purposes.

Following the stock split, you will need to allocate your pre-split tax basis in your old Macy's, Inc. shares equally between your old Macy's, Inc. shares and your new Macy's, Inc. shares. Consequently, 50% of the pre-split tax basis in your old Macy's, Inc. shares will be allocated to your old Macy's, Inc. shares and the remaining 50% will be allocated to your new Macy's, Inc. shares. For a shareholder who owns several blocks of Macy's, Inc. stock that were purchased at different times, this allocation must be done on a block by block basis.

You should consult with your own personal tax advisor if you have any questions regarding your own specific facts and circumstances.

What happens to my shares in the BuyDIRECT^sm Dividend Reinvestment Program?
Your DRIP share count will double.

What is Direct Registration?
Direct Registration is a form of electronic registration of stock ownership that enables Macy's, Inc. shareholders to be directly registered on the books of The Bank of New York, as agent for Macy's, Inc., with no need for physical stock certificates.

What are the advantages of Direct Registration?
Direct Registration should be very convenient for you. The benefits include:

We recommend the you insure the package for 2% of the value of the shares being mailed [Value = Number of Shares X Current Stock Price]. If you have any questions regarding this process contact Bank of New York at 1-866-337-3311.

Can I get stock certificates instead of Direct Registration if I want to?
Macy's, Inc. is no longer issuing physical stock certificates. Your Direct Registration Transaction Advice will be your evidence of ownership of the shares.

What do I do with my current, pre-split, stock certificates?
Keep them - do not destroy them. The stock certificates are still valid. All your certificates should be kept in a safe place. However, as mentioned above, today most shares are kept in paperless fashion and shareholders with certificates have the option to conveniently convert all valid certificates to Direct Registration.

How does the stock split affect my stockholder voting rights this year?
The 2006 proxy-voting season takes place prior to the Record Date of the stock split. There is no impact. Next year, assuming your holdings are unchanged and if the total number of shares outstanding were to be unchanged, you would vote twice as many shares, but your proportionate vote would remain the same relative to other shareholders.

How can I sell my new shares if I choose?
This process is unchanged. You may sell shares through your stockbroker or through The Bank of New York's BuyDIRECT^sm Dividend Reinvestment Plan. For more information, contact them at 1-866-337-3311 or www.stockbny.com.

I am a May shareholder who didn't exchange my shares yet. What should I do? How will this affect the exchange?
Contact The Bank of New York for directions on how to submit your May shares for exchange into Macy's, Inc. common stock and cash. The number of FD shares you are entitled to receive as compensation for your May shares pursuant to the merger will simply double. Your cash consideration remains the same. Please contact the Reorganization Department at The Bank of New York at 1-800-292-2301.

How do I contact The Bank of New York?
The Bank of New York is the transfer agent and registrar for Macy's, Inc. common stock.

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