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Exhibit 1.2
Pricing Agreement
April 3, 1997
Xxxxxxx, Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
UBS Securities LLC,
as Representatives of the several Underwriters
named in Schedule I hereto
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Vornado Realty Trust, a Maryland real estate investment trust
(the "Company"), proposes, subject to the terms and conditions stated herein and
in the Underwriting Agreement, dated April 3, 1997 (the "Underwriting
Agreement"), between the Company, on the one hand, and Xxxxxxx, Xxxxx & Co., on
the other hand, to issue and sell to the Underwriters named in Schedule I hereto
(the "Underwriters") the Shares specified in Schedule II hereto (the "Designated
Shares" consisting of Firm Shares and any Optional Shares the Underwriters may
elect to purchase). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Shares which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall be deemed to refer to you. Unless otherwise defined herein, terms defined
in the
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Underwriting Agreement are used herein as therein defined and terms which are
not otherwise defined herein or therein are used herein as defined in the
Prospectus as amended or supplemented relating to the Designated Shares. The
Representative designated to act on behalf of the Representatives and on behalf
of each of the Underwriters of the Designated Shares pursuant to Section 12 of
the Underwriting Agreement and the address of the Representative referred to in
such Section 12 are set forth in Schedule II hereto.
An amendment to the Registration Statement, or a supplement to
the Prospectus, as the case may be, relating to the Designated Shares, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in
the Underwriting Agreement incorporated herein by reference, (a) the Company
agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
the time and place and at the purchase price to the Underwriters set forth in
Schedule II hereto, the number of Firm Shares set forth opposite the name of
such Underwriter in Schedule I hereto and, (b) in the event and to the extent
that the Underwriters shall exercise the election to purchase Optional Shares,
as provided below, the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly, to
purchase from the Company at the purchase price to the Underwriters set forth in
Schedule II hereto that portion of the number of Optional Shares as to which
such election shall have been exercised.
The Company hereby grants to each of the Underwriters the
right to purchase at their election up to the number of Optional Shares set
forth opposite the name of such Underwriter in Schedule I hereto on the terms
referred to in the paragraph above for the sole purpose of covering
over-allotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised by written notice from the Representatives to
the Company given within a period of 30 calendar days after the date of this
Pricing Agreement, setting forth the aggregate number of Optional Shares to be
purchased and the date on which such Optional Shares are to be delivered, as
determined by the Representatives, but in no event earlier than the First Time
of Delivery or, unless the Representatives and the Company otherwise agree in
writing, no earlier than two or later than ten business days after the date of
such notice.
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If the foregoing is in accordance with your understanding,
please sign and return to us seven counterparts hereof, and upon acceptance
hereof by you, on behalf of each of the Underwriters, this letter and such
acceptance hereof, including the provisions of the Underwriting Agreement
incorporated herein by reference, shall constitute a binding agreement between
each of the Underwriters and the Company. It is understood that your acceptance
of this letter on behalf of each of the Underwriters is or will be pursuant to
the authority set forth in a form of Agreement among Underwriters, the form of
which shall be submitted to the Company for examination, upon request, but
without warranty on the part of the Representatives as to the authority of the
signers thereof.
Very truly yours,
Vornado Realty Trust
By: /s/ Xxxxxx Xxxx
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Name: Xxxxxx Xxxx
Title: Chairman and Chief
Executive Officer
Accepted as of the date hereof:
Xxxxxxx, Sachs & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
UBS Securities LLC
By: /s/ Xxxxxxx, Sachs & Co.
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(Xxxxxxx, Xxxxx & Co.)
On behalf of each of the Underwriters
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SCHEDULE I
Maximum Number of
Number of Firm Optional Shares Which
Underwriter Shares to be Purchased May be Purchased
----------- ---------------------- ----------------
Xxxxxxx, Sachs & Co. ............................. 1,588,800 238,320
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated 1,191,600 178,740
UBS Securities LLC ............................... 1,191,600 178,740
Bear, Xxxxxxx & Co. Inc. ......................... 118,000 17,700
Alex. Xxxxx & Sons Incorporated .................. 118,000 17,700
Xxxx Xxxxxx Xxxxxxxx Inc. ........................ 118,000 17,700
X.X. Xxxxxxx & Sons, Inc. ........................ 118,000 17,700
Lazard Freres & Co. LLC .......................... 118,000 17,700
Advest, Inc. ..................................... 73,000 10,950
Xxxxxx X. Xxxxx & Co. Incorporated ............... 73,000 10,950
Xxxxxx X. Xxxxx & Co., L.P. ...................... 73,000 10,950
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated ............. 73,000 10,950
Xxxxxxxx Inc. .................................... 73,000 10,950
Xxxxxx Xxxxxxx Incorporated ...................... 73,000 10,950
Total ....................................... 5,000,000 750,000
========= =========
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SCHEDULE II
TITLE OF DESIGNATED SHARES:
$3.25 Series A Convertible Preferred Shares of Beneficial Interest
NUMBER OF DESIGNATED SHARES:
NUMBER OF FIRM SHARES: 5,000,000
MAXIMUM NUMBER OF OPTIONAL SHARES: 750,000
INITIAL OFFERING PRICE TO PUBLIC:
$50.00 per Share
PURCHASE PRICE BY UNDERWRITERS:
$48.00 per Share
COMMISSION PAYABLE TO UNDERWRITERS:
$2.00 per Share
EXPENSES:
The Underwriters will reimburse the Company for expenses incurred in
connection with the Offering in an amount not to exceed $625,000.
FORM OF DESIGNATED SHARES:
Definitive form, to be made available for checking and packaging at
least twenty-four hours prior to the Time of Delivery.
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Wire transfer of same day funds.
LOCK UP:
During the period beginning from the date of this Pricing Agreement and
continuing to and including the date 60 days after the date of this
Pricing Agreement, the Company will not offer, sell, contract to sell
or otherwise dispose of any Common Shares of Beneficial Interest of the
Company ("Common Shares") or any securities of the Company which are
substantially similar to the Common Shares or which are convertible or
exchangeable into securities which are substantially similar to the
Common Shares (other than pursuant to employee stock option plans
existing, or on the conversion or exchange of convertible or
exchangeable securities outstanding,
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on the date of this Agreement) without the consent of Xxxxxxx, Sachs &
Co.
TIME OF DELIVERY:
10:00 a.m. (New York City time), April 9, 1997
CLOSING LOCATION:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
NAME AND ADDRESS OF DESIGNATED REPRESENTATIVE:
Designated Representative: Xxxxxxx, Sachs & Co.
Address for Notices, etc.: c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
DIVIDENDS:
Cumulative at the annual rate of 6.50% per share on the liquidation
preference of the Series A Preferred Shares payable quarterly in
arrears on the first calendar day of January, April, July and October
of each year, commencing July 1, 1997.
LIQUIDATION PREFERENCE:
$50.00 per share, plus an amount equal to accrued and unpaid dividends
(whether or not earned or declared).
RANKING:
If the Mendik Transaction (as defined in the Prospectus) is
consummated, the Company will acquire Series A Preferred Units of the
Operating Partnership (with terms mirroring the terms of the Series A
Preferred Shares) in exchange for the cash proceeds from the sale of
the Series A Preferred Shares. Series A Preferred Units will rank
senior to all classes of Operating Partnership units, including the
Class A, C, D and E Operating Partnership units issued in connection
with the Mendik Transaction, with respect to payment of dividends and
amounts upon liquidation, dissolution or winding up of the Operating
Partnership.
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CONVERSION RIGHTS:
The Series A Preferred Shares are convertible, in whole or in part, at
the option of the holder at any time, unless previously redeemed, into
shares of the Company's Common Shares, at an initial conversion price
of $72.75 per Common Share (equivalent to a conversion rate of 0.68728
Common Shares per Series A Preferred Share), subject to adjustment in
certain circumstances.
REDEMPTION AT OPTION OF THE COMPANY:
Except in certain circumstances relating to the preservation of the
Company's status as a REIT, the Series A Preferred Shares are not
redeemable prior to April 1, 2001, and at no time will the Series A
Preferred Shares be redeemable for cash. On and after April 1, 2001,
the Series A Preferred Shares will be redeemable by the Company, in
whole or in part, at the option of the Company, for such number of
Common Shares as are issuable at the initial conversion rate of 0.68728
Common Shares for each Series A Preferred Share, subject to adjustment
in certain circumstances. The Company may exercise this option only if
for 20 trading days within any period of 30 consecutive trading days,
including the last trading day of such period, the closing price of the
Common Shares on the New York Stock Exchange exceeds $87.30 per share,
subject to adjustment in certain circumstances. In order to exercise
its redemption option, the Company must issue a press release
announcing the redemption prior to the opening of business on the
second trading day after the conditions described in the preceding
sentences have, from time to time, been met, but may not issue any such
press release prior to April 1, 2001.
VOTING RIGHTS:
Holders of the Series A Preferred Shares generally will have no voting
rights. However, if dividends on the Series A Preferred Shares are in
arrears for six quarterly dividend periods, the holders of the Series A
Preferred Shares (voting separately as a class with holders of all
other series of parity preferred stock upon which like voting rights
have been conferred and are exercisable) will have the right to elect
two additional trustees to serve on the Company's Board of Trustees
until such dividend arrearage is eliminated. In addition, the approval
of two-thirds of the outstanding Series A Preferred Shares (voting
separately as a class with holders of all other series of parity
preferred stock upon which like voting rights have been conferred and
are exercisable) is required in order to
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amend the Company's Amended and Restated Declaration of Trust and
Articles Supplementary to affect materially and adversely the rights,
preferences or voting powers of the holders of the Series A Preferred
Shares or such parity shares or to authorize, create, or increase the
authorized amount of, any class of stock having rights senior to the
Series A Preferred Shares with respect to the payment of dividends or
amounts upon liquidation, dissolution or winding up.
LISTING:
New York Stock Exchange: "VNO Pr A"
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