EXECUTION COPY
PURCHASE AGREEMENT
November 17, 2003
Xxxxx Xxxxx Tax-Advantaged Dividend Income Fund
c/o Xxxxx Xxxxx Management
The Xxxxx Xxxxx Building
000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile Number: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx
Ladies and Gentlemen:
1. Registration Statement and Prospectus. Vornado Realty Trust, a Maryland
real estate investment trust (the "REIT") has filed with the Securities and
Exchange Commission (the "SEC") a Registration on Form S-3 (File Nos.
333-29013, 333-40787 and 333-108138), including a Prospectus, dated August
28, 2003, relating to, among other things, certain of the REIT's equity
Securities (the "BASE PROSPECTUS") and will file a Prospectus Supplement,
dated November 17, 2003, to the Base Prospectus relating to the REIT's
7.00% Series D-10 Cumulative Redeemable Preferred Shares of Beneficial
Interest, liquidation preference $25.00 per share (the "SHARES") (the
"PROSPECTUS SUPPLEMENT" and, together with the Base Prospectus, the
"PROSPECTUS"). As used herein, the terms "Registration Statement", "Base
Prospectus", "Prospectus Supplement", and "Prospectus" include in each case
the material incorporated by reference therein.
2. Certain Representations; Opinion of Counsel.
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(a) The REIT represents and warrants to Xxxxx Xxxxx Tax-Advantaged Dividend
Income Fund, a Massachusetts business trust (the "SUBSCRIBER"), as
follows:
(i) The REIT has delivered to the Subscriber true, correct and
complete copies (including all exhibits) of (i) the REIT's Annual
Report on Form 10-K for the year ended December 31, 2002, (ii) the
REIT's Quarterly Reports on Form 10-Q for the periods ended March
31, June 30 and September 30, 2003, (iii) the Current Reports of
the REIT on Form 8-K filed with the SEC on May 28, June 2 and
September 23, 2003 (collectively, the "VORNADO REPORTS"). The
Vornado Reports were prepared and filed in compliance with the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"),
or the Securities Act of 1933, as amended (the "SECURITIES ACT"),
as applicable, and the rules and regulations promulgated by the
SEC thereunder, and did not, as of their respective dates, contain
any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements contained
therein, in light of the circumstances under which they were made,
not
misleading. The consolidated financial statements and the interim
consolidated financial statements of the REIT included in the
Vornado Reports were prepared in accordance with generally
accepted accounting principles (except as may be indicated in the
notes thereto) and fairly presented the consolidated financial
condition and results of operations of the REIT and its
subsidiaries at the dates thereof and for the periods then ended,
subject, in the case of the interim consolidated financial
statements, to normal year end adjustments and any other
adjustments described therein. Since December 31, 2002, the REIT
has filed all periodic or other reports required to be filed with
the SEC pursuant to the Exchange Act and the rules and regulations
promulgated thereunder.
(ii) Since September 30, 2003, there has not been any material adverse
change in or affecting the business, assets, financial condition
or business prospects of the REIT and its subsidiaries taken as a
whole, otherwise than as set forth or contemplated in the Vornado
Reports.
(iii) The REIT has all requisite trust authority and power to execute
and deliver this Agreement, the Exemption and Designation Pursuant
to Section 6.6(l) of the Amended and Restated Declaration of Trust
of Vornado Realty Trust (the "WAIVER") and the Articles
Supplementary of the REIT with respect to Shares approved by a
Pricing Committee of the REIT's Board of Trustees on and as of
November 17, 2003 (the "ARTICLES SUPPLEMENTARY") and to consummate
the transactions contemplated hereby and thereby, including filing
the Prospectus Supplement with the SEC pursuant to Rule 424
promulgated under the Securities Act. The execution and delivery
of this Agreement, the Waiver and the Articles Supplementary and
the consummation of the transactions contemplated hereby and
thereby have been duly and validly authorized by all requisite
trust action on the part of the REIT, and no other proceedings on
the part of the REIT are necessary to authorize this Agreement,
Waiver or the Articles Supplementary or to consummate the
transactions contemplated hereby and thereby. Each of this
Agreement, the Waiver and the Articles Supplementary has been duly
and validly executed and delivered by the REIT and, assuming this
Agreement has been duly authorized, executed and delivered by the
Subscriber and assuming that the Tax Representation Letter
Agreement in connection with the Waiver, dated November 17, 2003,
has been duly authorized, executed and delivered by the
Subscriber, constitutes a valid and binding agreement of the REIT
enforceable against the REIT in accordance with its terms except
as may be limited by applicable bankruptcy, conservatorship,
receivership, insolvency, reorganization, moratorium or similar
laws affecting rights of creditors generally and by general
principles of equity.
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(iv) Neither the execution and delivery of this Agreement, the Waiver
or the Articles Supplementary by the REIT nor the consummation by
the REIT of the transactions contemplated hereby or thereby nor
compliance by the REIT with any of the provisions hereof or
thereof will (i) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default
(or give rise to any right of termination, cancellation or
acceleration) under, any of the terms, conditions or provisions of
the Amended and Restated Declaration of Trust of the REIT, as
amended, including through the Articles Supplementary (the
"DECLARATION OF TRUST"), any note, bond, mortgage, indenture,
lease, license, contract, agreement or other instrument or
obligation to which the REIT is a party or by which it or any of
its properties or assets may be bound or (ii) to the knowledge of
the REIT, violate any order, writ, injunction, decree, statute,
rule or regulation applicable to the REIT or any of its properties
or assets, except in the case of (ii) for violations, breaches or
defaults that would not in the aggregate have a material adverse
effect on the business or financial condition of the REIT and its
subsidiaries taken as a whole and that shall not materially impair
the effectiveness of the transactions contemplated hereby.
(v) No action, suit, claim, investigation or proceeding, whether legal
or administrative or in mediation or arbitration, is pending or,
to the knowledge of the REIT, threatened, at law or in equity,
against the REIT before or by any federal, state, county or
municipal court, tribunal, government, or any department, agency,
bureau, board or commission, regulatory authority, or other
governmental or similar type body, subdivision or instrumentality
obtaining authority therefrom or created pursuant to any law which
if determined adversely to the REIT could reasonably be expected
to interfere in any material respect with the ability of the REIT
to perform its obligations pursuant to this Agreement or the
Articles Supplementary or which seek to restrain, prohibit,
invalidate, set aside, rescind, prevent or make unlawful this
Agreement or the Articles Supplementary or the carrying out of
this Agreement or the Articles Supplementary. There are no
judgments, decrees or orders entered on a suit or proceeding
against the REIT which, if determined adversely to the REIT could
reasonably be expected to materially adversely affect the ability
of the REIT to perform its obligations pursuant to this Agreement
or the Articles Supplementary, or which seeks to restrain,
prohibit, invalidate, set aside, rescind, prevent or make unlawful
this Agreement or the Articles Supplementary or the carrying out
of this Agreement or the Articles Supplementary.
(vi) The REIT has delivered to the Subscriber a true and complete copy
of the Declaration of Trust and By-Laws of the REIT, each as
amended or supplemented (including all Articles Supplementary and
exhibits), which
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has been filed with the State Department of Assessments and
Taxation of Maryland, and such has not been amended and no such
amendment to said Amended and Restated Declaration of Trust has
been approved by the Board of Trustees or the shareholders of the
REIT since the Articles Supplementary were approved by said Board
of Trustees on and as of November 17, 2003.
(vii) The Shares have been duly authorized and, when issued pursuant to
the terms of this Agreement, will be validly issued and
outstanding, fully paid and non-assessable and will be free of any
preemptive rights. In addition, the Shares, when issued pursuant
to the terms of this Agreement, will not constitute "Excess Stock"
as defined under the Declaration of Trust.
(viii) The Registration Statement and the Prospectus (A) comply in all
material respects with the Securities Act and the applicable rules
and regulations thereunder, (B) correctly describe in all material
respects the business of the REIT and (C) do not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading.
(ix) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, when
they became effective or were filed with the SEC, as the case may
be, complied in all material respects with the requirements of the
Securities Act or the Exchange Act, as applicable, and the rules
and regulations of the SEC thereunder.
(x) The Prospectus Supplement will be filed with the SEC in the manner
and within the time period required by Rule 424(b). The
Registration Statement has been declared effective under the
Securities Act, and no stop order suspending the effectiveness of
the Registration Statement and no order directed at any document
incorporated by reference in the Prospectus or any amendment or
supplement thereto has been issued, and no proceedings for that
purpose have been instituted or threatened by the SEC.
(xi) The REIT is a real estate investment trust, duly formed and
existing under the laws of the state of Maryland in good standing
with the State Department of Taxation of Maryland, with trust
power to own, lease and operate its properties and to conduct its
business and is duly qualified as a foreign organization to
transact business and is in good standing in each jurisdiction in
which such qualification is required except where the failure to
so qualify would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business
affairs or business prospects of the REIT and its subsidiaries
taken as a whole.
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(xii) Neither the REIT nor any subsidiary of the REIT has any present
plan or intention, and neither the REIT nor any subsidiary of the
REIT has any actual knowledge of any present plan or intention of
any partner in Vornado Realty L.P., a Delaware limited partnership
(the "PARTNERSHIP"), to take any action or actions that would or
likely would result in the Partnership becoming a PTP in the
foreseeable future. Neither the REIT nor any subsidiary of the
REIT has actual knowledge of facts that reasonably would cause it
to expect that the Partnership would or likely would become a PTP
in the foreseeable future.
(xiii) The REIT has properly elected to be taxed as a Qualified REIT in
accordance with Sections 856 to 860 of the Code, currently
qualifies for taxation as a Qualified REIT and has no plan or
intention or knowledge of facts that likely would cause it to fail
to qualify for taxation as a Qualified REIT in the foreseeable
future.
(xiv) Upon issuance of the Shares to the Subscriber pursuant to this
Agreement, there shall be no class or series of shares of
beneficial interest in the REIT authorized or outstanding that
shall be entitled to the receipt of dividends or distributions or
of amounts distributable upon liquidation, dissolution or winding
up of the REIT in preference or priority to the holders of the
Shares.
(xv) No Existing Constructive Holder has sent the REIT a Section 6.9(a)
Notice (as such term is defined in Section 9(b) of the Declaration
of Trust) that an event described in Section 6.9(a) of the
Declaration of Trust has occurred and is continuing.
(xvi) For so long as the Waiver remains in effect, the Company, upon
the written request of the Subscriber shall use commercially
reasonable efforts to cooperate with and respond in writing to
written inquiries regarding Vornado's tenants or such other
information about the REIT and its shareholders to assist the
Subscriber in determining compliance with the representations,
warranties and undertakings on which the Waiver relies.
As used herein, the following terms have the following meanings:
"CODE" means the Internal Revenue Code of 1986, as amended.
"PTP" means a "publicly traded partnership" within the meaning of Section
7704 of the Code.
"QUALIFIED REIT" means an entity that has properly elected to be taxed as a
real estate investment trust in accordance with Sections 856 to 860 of the
Code, currently qualifies for taxation as a real estate investment trust
thereunder.
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(b) At the Closing (as defined below), counsel to the REIT will render
opinions to the Subscriber in substantially the forms attached hereto
as Exhibits A and B.
3. Sale of Shares.
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(a) The REIT hereby agrees to sell to the Subscriber, and the Subscriber
hereby agrees to purchase from the REIT, 1,600,000 Shares. The purchase
price of each Share is $25.00, and is payable in cash at the Closing.
(b) The sale and purchase of the Shares (the "CLOSING") shall take place at
the offices of the REIT on November 17, 2003 (the "CLOSING DATE").
(c) On the Closing Date, the Subscriber shall, if the condition set forth
in Section 3(d) below is satisfied on the Closing Date, pay to the REIT
by wire transfer in immediately available funds the purchase price of
the Shares purchased by the Subscriber, against delivery to such
Subscriber of each of the documents set forth on Schedule A attached
hereto.
(d) The obligations of the Subscriber to purchase the Shares hereunder are
subject to the accuracy of the REIT's representations and warranties
contained herein, the opinions to be delivered to pursuant to Section
1(b) and the delivery of the documents set forth on Schedule A.
(e) The obligation of the REIT to issue and sell any of the Shares is
subject to the accuracy of the representations and warranties of the
Subscriber contained herein and the delivery by the Subscriber of the
entire purchase price.
4. Subscriber Representations.
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The Subscriber represents and warrants to the REIT that it is able to bear
the economic risk of losing its entire investment in the Shares and
understands that an investment in the the REIT involves substantial risks;
the Subscriber has the power and authority to enter into this Agreement,
and the execution and delivery of, and performance under this Agreement,
shall not conflict with any rule, regulation, judgment or agreement
applicable to the Subscriber. The Subscriber has had the opportunity to
discuss the REIT's affairs with the REIT's officers.
5. Covenant of the REIT.
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The REIT shall not issue any Shares to any Person other than the 1,600,000
Shares to be issued to the Subscriber herewith or a holder of Series D-10
Preferred Units of the Partnership (the "UNITS") upon redemption of such
Units.
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6. Miscellaneous.
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(a) This Agreement may not be amended or terminated except by written
agreement of the Subscriber and the REIT. This Agreement shall be
binding on the parties and on their permitted assigns.
This Agreement may be executed by any one or more of the parties hereto
in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and
the same instrument.
(b) This Agreement shall be governed by and construed in accordance with
the laws of the State of New York. The federal and state courts sitting
in the Borough of Manhattan in The City of New York, New York, shall
have exclusive jurisdiction over all matters relating to this
Agreement.
(c) All notices, requests, service of process, consents, and other
communications under this Agreement shall be in writing and shall be
deemed to have been delivered (i) on the date personally delivered or
(ii) one day after properly sent by recognized overnight courier,
addressed to the respective parties at their address set forth in this
Agreement or (iii) on the day transmitted by facsimile so long as a
confirmation copy is simultaneously forwarded by recognized overnight
courier, in each case addressed to the respective parties at their
address or facsimile number set forth in this Agreement. Any party
hereto may designate a different address or facsimile number by
providing written notice of such new address or facsimile number to the
other party hereto as provided above.
(d) Without prejudice to its ability to recover for any losses, damages or
liabilities relating to any dispute, controversy or claim arising out
of or relating to this Agreement, each of the parties hereto shall pay
its own costs and expenses (including fees of its counsel) in
connection with this Agreement and the transactions contemplated hereby
and any amendments, consents or waivers (whether or not the same become
effective) under or in respect of this Agreement.
(e) The continuing liability of each of the Subscriber and the REIT
hereunder from and after the effectiveness of the transactions
hereunder contemplated to occur at the closing shall not exceed the
amount of money constituting the purchase price of the Shares purchased
by the Subscriber.
(f) The covenant of the REIT in Section 5 hereof shall survive the Closing
so long as the Shares are outstanding. The representations and
warranties of the Subscriber and the REIT herein contained shall
survive the Closing to the extent provided by the statute of
limitations as to such breaches under applicable law.
(g) A copy of the Agreement and Declaration of Trust of the Subscriber is
on file with the Secretary of State of the Commonwealth of
Massachusetts, and notice hereby is given that this Agreement is
executed on behalf of the Subscriber by an
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officer or Trustee of the Subscriber in his or her capacity as an
officer or Trustee of the Subscriber and not individually and that the
obligations under or arising out of this Agreement are not binding upon
any of the Trustees, officers or shareholders individually but are
binding only upon the assets and properties of the Subscriber.
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If the foregoing is in accordance with your understanding, please sign
and return to us a counterpart hereof, and upon the acceptance hereof by you
this letter and such acceptance hereof shall constitute a binding agreement
between the REIT and the Subscriber.
VORNADO REALTY TRUST
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: 000-000-0000
Attention: Executive Vice President -
Finance and Administration
and Chief Financial Officer
By /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: Executive Vice President -
Finance and Administration
and Chief Financial Officer
Confirmed, accepted and agreed
as of the date hereof:
XXXXX XXXXX TAX-ADVANTAGED DIVIDEND INCOME FUND
c/o Xxxxx Xxxxx Management
The Xxxxx Xxxxx Building
000 Xxxxx Xxxxxx
Xxxxxx Xxxxxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention:
By /s/ Xxxxxx X. Xxxxx, Xx.
---------------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: President
SCHEDULE A
1. The Articles Supplementary with respect to 7.00% Series D-10 Cumulative
Redeemable Preferred Shares, dated as of November 17, 2003 in the form
attached hereto as Exhibit C as filed with and accepted by the State
Department of Assessments and Taxation of Maryland.
2. The legal opinions issued by Xxxxxxxx & Xxxxxxxx LLP and Xxxxxxx LLP to the
Subscriber, dated as of November 17, 2003.
3. The good standing certificate of the REIT.
4. The Cross-Receipt.
5. Officer's Certificate of Vornado Realty Trust certifying as to authority,
good standing, and incumbency and attaching certified copies of resolutions
of the Board of Trustees.
6. The Exemption and Designation Pursuant to Section 6.6(1) of the Amended and
Restated Declaration of Trust of Vornado Realty Trust.
