As filed with the Securities and Exchange Commission on December 23, 2008
Registration No. 333-155727
SECURITIES AND EXCHANGE COMMISSION ON , 1995
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Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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_______________
AMENDMENT NO. 1 TO FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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ALEXANDER'S,
___________________
ALEXANDERS, INC.
(Exact
(Exact name of registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation or organization) | 51-01-00517 (I.R.S. Employer Identification No.) | |
210 Route 4 East Paramus, New Jersey 07652 (201) 587-8541 (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices) ___________________ | ||
Joseph Macnow Chief Financial Officer Alexanders, Inc. 888 Seventh Avenue New York, New York 10019 (212) 894-7000 (Name, address, and telephone number of agent for service) | ||
| Copies to: | |
Bruce Czachor, Esq. Shearman & Sterling LLP 599 Lexington Avenue New York, New York 10022 | Alan Rice, Esq. Secretary Alexanders, Inc. 888 Seventh Avenue New York, New York 10019 |
Approximate date of commencement of proposed sale to the public: FROM TIME TO
TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT AS DETERMINED BY
MARKET CONDITIONS.
From time to time after the effective date of this registration statement.
If the only securities being registered on this Formform are being offered pursuant to dividend or interest reinvestment plans, please check the following box. / /
¨
If any of the securities being registered on this Formform are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. /x/
x
If this Formform is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /
¨
If this Formform is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /
¨
If delivery ofthis form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the prospectus is expected to be madeCommission pursuant to Rule 434, please462(e) under the Securities Act, check the following box. /x/
2
CALCULATION OF REGISTRATION FEE
(1) In U.S. Dollars or the equivalent thereof denominated in one or more
foreign currencies or units of two or more foreign currencies or
composite currencies (such as European Currency Units).
(2) Estimated for the sole purpose of computing the registration fee.
(3) There are being registered hereunder an indeterminate number of shares
of Common Stock of the Registrant as may be sold, from time to time, by
the Registrant. There are also being registered hereunder an
indeterminate number of shares of Common Stock of the Registrant as may
be issuable upon conversion of convertible Debt Securities or Preferred
Stock registered hereby.
(4) There are being registered hereunder an indeterminate number of shares
of Preferred Stock of the Registrant as may be sold, from time to time,
by the Registrant. There are also being registered hereunder an
indeterminate number of shares of Preferred Stock of the Registrant as
may be issuable upon conversion of convertible Debt Securities
registered hereby.
(5) There are being registered hereunder an indeterminate number of
Depositary Shares to be evidenced by Depositary Receipts issued pursuant
to a Deposit Agreement. In the event the Registrant elects to offer to
the public fractional interests in Preferred Stock registered hereunder,
Depositary Receipts will be distributed to those persons purchasing such
fractional interests and shares of Preferred Stock will be issued to the
Depositary under the Deposit Agreement. No separate consideration will
be received for the Depositary Shares.
(6) There are being registered hereunder an indeterminate amount of Debt
Securities.
(7) Debt Warrants may be sold separately or with Debt Securities.
(8) Such amount represents the aggregate offering price of the Debt
Securities, Common Stock, Preferred Stock, Depositary Shares and Debt
Warrants as follows: the principal amount of any Debt Securities issued
at their principal amount, the issue price rather than the principal
amount of any Debt Securities issued at an original issue discount, the
liquidation preference of any Preferred Stock, the amount computed pursuant to Rule 457(c) for any Common Stock, the issue price of any
Debt Warrants and the exercise price of any Debt Securities issuable
upon the exercise of Debt Warrants.
(9) No separate consideration will be received for the Debt Securities,
Preferred Stock, Common Stock or Depositary Shares issuable upon
conversion of or in exchange for Debt Securities or Preferred Stock.
(10) Calculated pursuant to Rule 457(o) of the rules and regulations413(b) under the Securities Act, check the following box. ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of 1933, as amended (the "Securities Act").
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“large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
¨ Large accelerated filer | x Accelerated filer |
¨ Non-accelerated filer (Do not check if a smaller reporting company) | ¨ Smaller reporting company |
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A)8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A)8(a), MAY DETERMINE.
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CALCULATION OF REGISTRATION FEE
| TITLE OF EACH CLASS OF SECURITIES TO BE REGISTERED | AMOUNT TO BE REGISTERED(1)(2) | PROPOSED MAXIMUM OFFERING PRICE PER UNIT (4) | PROPOSED MAXIMUM AGGREGATE OFFERING PRICE(1)(2)(3) | AMOUNT OF REGISTRA- TION FEE(2) |
| Common stock, par value $1.00 per share | ||||
| Preferred stock, par value $1.00 per share | ||||
| Depositary shares representing preferred stock(5) | ||||
| Debt securities | ||||
| Debt warrants(6) | ||||
| Total | $1,500,000,000 | (4) | (1)(2)(3) | (2) |
(1) An indeterminate aggregate initial offering price or number of the common stock, preferred stock, depositary shares, debt securities and debt warrants is being registered as may from time to time be issued at indeterminate prices in an aggregate amount not to exceed $1,500,000,000 or the equivalent of that amount in one or more other currencies, currency units or composite currencies.
(2) A filing fee of $121,350 was previously paid for the $1,500,000,000 aggregate initial offering price of securities registered under Registration Statement Nos. 333-110673 and 33-62779. Pursuant to Rule 415(a)(6) under the Securities Act, the associated filing fee of $121,350 will be applied to the unsold $1,500,000,000 aggregate initial offering price of common stock, preferred stock, depositary shares representing preferred stock, debt securities and debt warrants of Alexander’s, Inc. registered under Registration Statement Nos. 333-110673 and 33-62779 and the offering of such unsold securities will be deemed terminated as of the date of effectiveness of this Registration Statement.
(3) Estimated for the sole purpose of computing the registration fee in accordance with Rule 457(o) under the Securities Act. Separate consideration may not be received for registered securities that are issuable on conversion or exchange of other securities or represented by depositary shares.
(4) Omitted in accordance with General Instruction II.D of Form S-3 under the Securities Act.
(5) Each depositary share will be issued under a deposit agreement, will represent an interest in a fractional preferred share and will be evidenced by a depositary receipt.
(6) Debt warrants may be sold separately or with other securities.
THE INFORMATION CONTAINED HEREININ THIS PROSPECTUS IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TONOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES HAS BEENUNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMESCOMMISSION IS EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTEIS NEITHER AN OFFER TO SELL OR THE
SOLICITATION OFTHESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCHTHE OFFER SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED , 1995
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[Alexander's, Inc. Logo]
Prospectus
Debt Securities, Preferred Stock, Depositary Shares, Common
Stock and Debt Warrants
-----------------------------
Alexander's, Inc. (the "Company")December 23, 2008
PROSPECTUS
$1,500,000,000
COMMON STOCK
PREFERRED STOCK
DEPOSITARY SHARES
DEBT SECURITIES
DEBT WARRANTS
We may, offer from time to time, together
or separately, in one or more series (i)offer to sell common stock, preferred stock, debt securities ("Debt Securities"),
whichand debt warrants. The preferred stock may either be sold separately or represented by depositary shares. The debt securities may be either senior debt securities (the "Senior Debt Securities")exchangeable for our common or
subordinated debt securities (the "Subordinated Debt Securities"), (ii) shares
of preferred stock $1.00 par value per share, ofand the Company ("Preferred
Stock"), whichpreferred stock may be issued in the formconvertible into common stock or into preferred stock of depositary shares (the "Depositary
Shares") evidenced by depositary receipts, (iii) sharesanother series. The debt warrants will be to purchase debt securities. The total amount of common stock, $1.00
par value per share, of the Company ("Common Stock") and (iv) warrants to
purchasepreferred stock, depositary shares, debt securities of the Company as shall be designated by the Company
at the time of the offering (the "Debt Warrants") (the Debt Securities,
Preferred Stock, Common Stock and Debt Warrants are collectively referred to as
the "Securities"), atdebt warrants offered under this prospectus will have an initial aggregate initial offering price notof up to exceed U.S.
$250,000,000,$1,500,000,000 or the equivalent amount in amounts, at prices and on terms to be determined at the time
of sale.other currencies, currency units or composite currencies. The Debt Securities, Preferred Stock, Common Stock and Debt Warrantssecurities may be offered separately or together and in one or more separate seriesseries.
We may offer and sell these securities to or through one or more underwriters, dealers and agents or directly to purchasers, on a continuous or delayed basis.
We will provide the specific terms of these securities in amounts, at prices
and on terms to be set forth in a supplementsupplements to this Prospectus (a "Prospectus
Supplement").
The accompanying Prospectus Supplement will set forth with regard to the
particular Securities in respect of whichprospectus. You should read this Prospectus is being delivered
(i) in the case of Debt Securities, the title, aggregate principal amount,
denominations (which may be in United States dollars, or in any other currency,
currencies or currency unit, including the European Currency Unit), maturity,
rate, if any (which may be fixed or variable), or method of calculation
thereof, time of payment of any interest, any terms for redemption at the
option of the Company or the Holder, any terms for sinking fund payments, rank,
any conversion or exchange rights, any listing on a securities exchange,prospectus and the initial public offering price and any other terms in connection with the
offering and sale of such Debt Securities, (ii) in the case of Preferred Stock,
the specific title, the aggregate amount and the stated value, any dividend
(including the method of calculating the payment of dividend), liquidation,
redemption, conversion, voting or other rights and the initial public offering
price, (iii) in the case of Common Stock, the number of shares of Common Stock,
the initial offering price and the terms of the offering thereof and (iv) in
the case of Debt Warrants, the duration, purchase price, exercise price and
detachability of such Debt Warrants. The Prospectus Supplement will also
contain information, as applicable, about certain United States federal income
tax considerations relating to the Securities in respect of which this
Prospectussupplements carefully before you invest.
Our common stock is being delivered.
The shares of Common Stock of the Company are listed on the New York Stock Exchange ("NYSE") under the symbol "ALX".
The Company intends to qualify as a real estate investment trust
("REIT") for federal income tax purposes for the year ending December 31, 1995.
SEE "RISK FACTORS" BEGINNING ON PAGE 5 HEREIN FOR A DISCUSSION OF
CERTAIN FACTORS THAT SHOULD BE CAREFULLY CONSIDERED BY PROSPECTIVE INVESTORS IN
THE SECURITIES.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
-----------------------------
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED
ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY
REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
-----------------------------
The Company may sell Securities to or through underwriters, and also may
sell Securities directly to other purchasers or through agents. The
accompanying Prospectus Supplement will set forth the names of any underwriters
or agents involved“ALX.”
Investing in our securities involves risks that are described in the sale“Risk Factors” section of our periodic reports filed with the Securities and Exchange Commission or in respectthe applicable prospectus supplement.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of whichthese securities or determined if this Prospectusprospectus is being delivered, the amounts of Securities, if any, to be
purchased by underwriters and the compensation, if any, of such underwriterstruthful or agents. See "Plan of Distribution" herein.
The date of this Prospectus is _______________, 1995.
4
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS
PROSPECTUS OR THE ACCOMPANYING PROSPECTUS SUPPLEMENT IN CONNECTION WITH THE
OFFER CONTAINED IN THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITERS, AGENTS OR
DEALERS. THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT
CONSTITUTE AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY SECURITIES IN
ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS AND THE ACCOMPANYING
PROSPECTUS SUPPLEMENT NOR ANY SALE OF OR OFFER TO SELL THE SECURITIES OFFERED
HEREBY SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY AND ITS SUBSIDIARIES SINCE THE
RESPECTIVE DATES OF THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT
OR THAT THE INFORMATION CONTAINED IN THIS PROSPECTUS OR THE ACCOMPANYING
PROSPECTUS SUPPLEMENT IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE RESPECTIVE
DATES OF THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT.
AVAILABLE INFORMATION
The Company is subjectcomplete. Any representation to the informational requirements ofcontrary is a criminal offense.
________________
Prospectus dated December 23, 2008
| 1 | |
| FORWARD-LOOKING STATEMENTS | 2 |
| ALEXANDER’S, INC. | 4 |
| RATIOS OF EARNINGS TO FIXED CHARGES | 6 |
| USE OF PROCEEDS | 6 |
| DESCRIPTION OF DEBT SECURITIES | 7 |
| DESCRIPTION OF CAPITAL STOCK | 25 |
| DESCRIPTION OF DEBT WARRANTS | 37 |
| LEGAL OWNERSHIP AND BOOK-ENTRY ISSUANCE | 39 |
| CERTAIN FEDERAL INCOME TAX CONSIDERATIONS | 44 |
| PLAN OF DISTRIBUTION | 61 |
| VALIDITY OF THE SECURITIES | 61 |
| EXPERTS | 61 |
In this prospectus, “Alexander’s,” “we,” “our” or “us” refers to Alexander’s, Inc. and its consolidated subsidiaries, unless the Securities Exchange Act of 1934, as amended (the "Exchange Act"),context requires otherwise.
i
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and in
accordance therewith filescurrent reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"“SEC”). The reports, proxy
statementsYou may read and other information filed by the Company with the Commission can
be inspected and copiedcopy any document we file at the CommissionSEC’s public reference room at Room 1024, Judiciary Plaza, 450
Fifth100 F Street, N.W.N.E., Washington, D.C. 20549, andDC 20549. Please call the SEC at 1-800-SEC-0330 for further information on its public reference room. Our SEC filings are also available to the following regional
offices ofpublic through the Commission: 7 World Trade Center, 13th Floor, New York, New York
10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. Copies of such information can be obtained from the
Public Reference Section of the Commission, 450 Fifth Street, N.W., Washington,
D.C. 20549,SEC’s web site at prescribed rates. The Company's Common Stock ishttp://www.sec.gov. Our common shares are listed on the New York Stock Exchange, ("NYSE") and similar information can be inspected and
copied at the NYSE, 20 Broad Street, 17th Floor, New York, New York 10005.
about us is also available there.
This Prospectus constitutesprospectus is a part of a registration statement on Form
S-3 (the "Registration Statement") filed by the Company with the Commission
under the Securities Act of 1933, as amended (the "Securities Act"). As
permitted by the rules and regulations of the Commission, this Prospectus omits
certain of the information contained in the Registration Statement and
reference is hereby made to the Registration Statement and related exhibits for
further information with respect to the Company and the Securities offered
hereby. Statements contained herein concerning the provisions of any documents
filed as an exhibit to the Registration Statement or otherwisethat we filed with the Commission are not necessarily complete, andSEC. The SEC allows us to “incorporate by reference” the information that we file with it, which means that we can disclose important information to you by referring you to other documents that we identify as part of this prospectus. Any information referred to in each instance referencethis way is made
toconsidered part of this prospectus from the copydate we file that document. Our subsequent filings of such document so filed. Each such statement is qualified in its
entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K and its Form 10-K/A for the fiscal
year ended December 31, 1994, Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 1995 and June 30, 1995 and Current Reports on Form 8-K
dated January 4, 1995 and February 6, 1995 have been filed by the Companysimilar documents with the CommissionSEC will automatically update and are hereby incorporatedsupercede this information. We incorporate by reference into this Prospectus.
All otherthe documents listed below and reports filed pursuant to Sectionsany future filings we make with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act from the date of this Prospectus and prior to the
termination of the offering of the Securities shall be deemed to be incorporated
by reference herein and shall be deemed to be a part hereof from1934 (1) after the date of the filing of such reportsthis registration statement and before its effectiveness and (2) until our offering of securities has been completed.
We incorporate by reference into this prospectus the documents (provided, however, thatlisted below or information filed with the SEC:
| · | Annual Report on Form 10-K for the fiscal year ended December 31, 2007. |
| · | Quarterly Reports on Form 10-Q for the quarters ended March 31, 2008, June 30, 2008 and September 30, 2008. |
You may obtain a copy of these filings, at no cost, by writing to or telephoning us at the following address: Alexander’s, Inc., 888 Seventh Avenue, New York, NY 10019, Attention: Corporate Secretary. Telephone (212) 894-7000.
You should rely only on the information incorporated by reference or provided in this prospectus or any supplement. We have not authorized anyone else to provide you with different information. This prospectus is an offer to sell or buy only the securities described in this document, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of the date of this prospectus.
1
FORWARD-LOOKING STATEMENTS
Certain statements contained in this prospectus or the accompanying prospectus supplement, including the documents incorporated by reference, constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. Our future results, financial condition, results of operations and business may differ materially from those expressed in these forward-looking statements. You can find many of these statements by looking for words such as “approximates,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “would,” “may” or other similar expressions. We also note the following forward-looking statements: in the case of our development projects, the estimated completion date, estimated project costs and costs to complete.
These forward-looking statements represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Many of the factors that will determine these items are beyond our ability to control or predict.
These factors include those listed under the caption “Risk Factors” in the applicable prospectus supplement and in our periodic reports filed with the SEC, as well as the following:
| · | national, regional and local economic conditions, |
| · | consequences of any armed conflict involving, or terrorist attack against, the United States, |
| · | our ability to secure adequate insurance, |
| · | local conditions, such as an oversupply of space or a reduction in demand for real estate in the area, |
| · | competition from other available space, |
| · | whether tenants and other users such as customers and shoppers consider a property attractive, |
| · | the financial condition of our tenants, including the extent of tenant bankruptcies or defaults, |
| · | whether we are able to pass some or all of any increased operating costs through to tenants, |
| · | how well we manage our properties, |
| · | fluctuations in interest rates, |
| · | changes in real estate taxes and other expenses, |
| · | changes in market rental rates, |
| · | the timing and costs associated with property improvements and rentals, |
| · | changes in taxation or zoning laws, |
| · | government regulation, |
| · | availability of financing on acceptable terms or at all, |
| · | potential liability under environmental or other laws or regulations, and |
| · | general competitive factors. |
For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on the
2
forward-looking statements, which speak only as of the date of this prospectus or the date of the applicable prospectus supplement or any document incorporated by reference. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in item 402(a)(8) of Regulation S-K ofthis section. We do not undertake any obligation to release publicly, any revisions to our forward-looking statements to reflect events or circumstances after the Commission shall not be
deemed specifically incorporated by reference herein).
Any statement contained herein or in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for purposesdate of this Prospectus to the extent that a statement
-2-
5
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, on written or oral request of such person, a copy
of any or all documents which are incorporated herein by reference (not
including the exhibits to such documents, unless such exhibits are specifically
incorporated by reference in the document which this Prospectus incorporates).
Requests should be directed to the Secretary of the Company, Park 80 West,
Plaza II, Saddle Brook, New Jersey 07663, telephone number (201) 587-8541.
TABLE OF CONTENTS
-3-
6
THE COMPANY
The Companyprospectus.
3
ALEXANDER’S, INC.
Alexander’s, Inc. is a real estate companyinvestment trust incorporated in Delaware and engaged in leasing, managing, developing and redeveloping its properties. Alexander’s is managed by, and its properties focusing primarily onare leased and developed by, Vornado Realty Trust.
Alexander’s has seven properties in the properties
where its department stores were formerly located. These department stores
ceased operating in 1992 and are on properties located ingreater New York City and
Bergen County, New Jersey (the "New York Area"). The Company believes that its
properties offer advantageous retail opportunities, principally because of their
size and location in areas where comparable store sites are not readily
available.
The Company seeks to increase its income and property values by
strategically renovating, expanding and developing its properties. The
Company's general strategy is to lease each of its properties to large-space
users, typically national or large regional retailers, under long-term leases
(generally 20 years or longer) which provide the Company with fixed rents and
also with periodic rent increases (generally every five years). These leases
also generally require the tenant to pay, or reimburse the Company, for commonmetropolitan area charges (including roof and structure costs), real estate taxes, insurance
costs and certain capital expenditures.
The Company's real estate portfolio consists of the following nine
properties, four of which are currently operating (the "Operating Properties")
and five of which are currently being or will be redeveloped (the
"Redevelopment Properties"):
consisting of:
| · | Operating |
| · | the 731 Lexington Avenue property, a 1,307,000 square foot multi-use building which comprises the entire square block bounded by Lexington Avenue, East 59th Street, Third Avenue |
| · | the Kings Plaza |
| · | the Rego Park I property, located on Queens |
| · | the Paramus property, which consists of 30.3 acres of land located at the intersection of Routes 4 and 17 in Paramus, New Jersey, which is leased to IKEA Property, Inc.; |
| · | the Flushing property, located at Roosevelt Avenue and Main Street in Queens, New York, which contains a 177,000 square foot building that is currently vacant; |
| · | Property under development: |
| · | the Rego Park II property, containing approximately 6.6 acres of land adjacent to our Rego Park I property in Queens, |
| On December 21, 2007, we obtained a construction loan providing up to $350,000,000 to finance the construction of the shopping center. The loan has an interest rate of LIBOR plus 1.20% (3.68% at September 30, 2008), and a term of three years with a one-year extension option. The shopping center will be anchored by a 134,000 square foot Century 21 department store, a 138,000 square foot Home Depot and 132,000 square foot Kohl’s. |
| There can be no assurance that this project will be completed, completed on time, or completed for the budgeted amount; and |
| · | Property to be developed: |
4
| · | the Rego Park III property, containing approximately 3.4 acres of land adjacent to our Rego Park II property in Queens, New York, which comprises a one-quarter square block at the intersection of Junction Boulevard and the Horace Harding Service Road. |
5
RATIOS OF EARNINGS TO FIXED CHARGES; EFFECT OF ENCUMBRANCES;
COVENANT RESTRICTIONS
The Company has significant debt service obligations. The Company
borrowed $126,611,000 during the six months ended June 30, 1995 (the "1995
Financings") and at June 30, 1995, the Company's long-term debt was
$161,893,000. For the six months ended June 30, 1995, the Company's deficiencyCHARGES
Our consolidated ratios of earnings to cover fixed charges was $9,210,000. The Company also had a
deficiency in net assets of $26,277,000 at June 30, 1995. The Company's
ability to operate as a viable real estate company will depend on the
successful and timely completionfor each of the development and leasing of the
Redevelopment Properties, which will materially affect the Company's ability to
meet its debt service requirements.
Under the 1995 Financings, the Company granted certain lenders
mortgages on all of the Company's assets and/or pledges of the stock of the
Company's subsidiaries owning assets and/or guarantees of such subsidiaries and
the Company. If the Company becomes insolvent or is liquidated, or if its
indebtedness is accelerated, the lenders under the 1995 Financings will be
entitled to payment in full from the proceeds of their security prior to the
payment to Holders of Securities. In such event, it is possible that there
would be no assets remaining from which claims of Holders of Securities could
be satisfied or, if any assets remain, such assets may be insufficient to
satisfy fully such claims.
The 1995 Financing documents contain certain restrictive covenants.
Such restrictions affect, and in many respects significantly limit or prohibit,
among other things, the ability of the Company and certain of its subsidiaries
to incur indebtedness, make prepayments of certain indebtedness, pay dividends,
make investments, engage in transactions with affiliates, issue or sell capital
stock of subsidiaries, create liens, sell assets, acquire or transfer property
and engage in mergers and consolidations. The covenants may significantly
limit the Company's (and such subsidiaries') operating and financial
flexibility and there can be no assurance that such restrictions will not
adversely affect the Company's (and such subsidiaries') ability to finance
future operations or capital needs or to engage in other business activities
which may be beneficial to the Company. Additional restrictive covenants may
be created with respect to a particular series of Securities and will be set
forth in the applicable Prospectus Supplement.
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The Company believes that it and its subsidiaries will be able to
comply with such covenants and other restrictions; however, there can be no
assurance of such compliance. In the event of a default under the terms of any
indebtedness of the Company, the obligees thereunder would be permitted to
accelerate the maturity of such obligations, which may cause defaults under
other obligations of the Company, including Securities issued pursuant to this
Registration Statement. In such circumstances, Holders of such Securities may
be forced to accelerate the maturity of such Securities to protect their
interests at a time when it would not otherwise be in their interest to do so.
Further, such defaults could be expected to delay or preclude payment of
principal of and/or interest on such Debt Securities.
NEED FOR ADDITIONAL FINANCING
The Company's current Operating Properties do not generate
sufficient cash flow to pay all of its operating expenses and satisfy debt
service obligations. The Company estimates that the net proceeds from the
1995 Financings will be adequate to fund the Company's business operations
and debt service obligations into the first quarter of 1996 and the cost to
redevelop the Rego Park I Property. The Company will require significant
additional financing to meet its development plans for its other properties
and to pay its debt obligations. There can be no assurance that the Company
will be able to secure such financing on satisfactory terms, or at all, to
fund its financing needs.
HOLDING COMPANY STRUCTURE
Since substantially all of the Company's operations are conducted, and
substantially all of the Company's assets are owned, by its subsidiaries, the
Securities will effectively be subordinated to all existing and future
liabilities of the Company's subsidiaries, including the subsidiaries'
guarantees of indebtedness incurred under the 1995 Financings. Any right of
the Company to participate in any distribution of the assets of any of the
Company's subsidiaries upon the liquidation, reorganization or insolvency of
such subsidiary (and any consequent right of the Holders of the Securities to
participate in those assets) will be subject to the claims of the creditors
(including trade creditors) and preferred stockholders, if any, of such
subsidiary, except to the extent the Company has a claim against such
subsidiary as a creditor of such subsidiary. The Company has expressly
subordinated certain of its claims against its subsidiaries to the
subsidiaries' guarantees of indebtedness incurred under the 1995 Financings.
In addition, in the event that claims of the Company as a creditor of a
subsidiary are recognized, such claims would be subordinate to any security
interest in the assets of such subsidiary and any indebtedness of such
subsidiary senior to that held by the Company.
The Company's ability to make required principal and interest payments
with respect to its indebtedness, including any Debt Securities, depends on the
earnings of its subsidiaries and on its ability to receive funds from such
subsidiaries through dividends or other payments. Since the Securities are
obligations of the Company only, the Company's subsidiaries are not obligated
or required to pay any amounts due pursuant to the Securities or to make funds
available therefor in the form of dividends or advances to the Company.
REAL ESTATE INVESTMENT RISKS
General
Real property investments are subject to varying degrees of risk. The
Company's success will be affected by, among other factors, the trends of the
national and local economies, the financial condition and operating results of
current and prospective tenants, the availability and cost of capital, interest
rate levels, construction and renovation costs, income tax laws, governmental
regulations and legislation, population trends, the market for real estate
properties in the New York Area, competition from other available space, zoning
laws, potential liability under environmental and other laws and the ability of
the Company to lease or sublease its properties at profitable levels.
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Dependence on Rental Income and Concentration of Rental Income with
Certain Lessees; Bankruptcy of Major Tenant
As substantially all of the Company's income is derived from rentals
of real property, the Company's results of operations will depend on its
ability to lease space in its real estate properties on economically favorable
terms.
Although none of the Company's leases are cancelable by the lessee in
the event of default by such lessee, the Company may experience delays in
enforcing its rights as lessor or sublessor and may incur substantial costs in
protecting its investment if the lessee defaults under its lease. In addition,
certain significant expenditures associated with real estate investments (such
as mortgage payments, real estate taxes and maintenance costs) are generally
not reduced when circumstances (such as vacancies or the inability of tenants
to meet their obligations) cause a reduction in income from the investment.
Should such events occur, the Company's income and cash flows would be
adversely affected. The Company's properties are mortgaged to secure payment
of indebtedness, and if the Company were unable to meet its mortgage payments,
a loss could be sustained as a result of a foreclosure on its property by the
mortgagee.
The Company's income and cash flows would be adversely affected if a
significant number of the Company's lessees (or a lessee accounting for a
significant portion of the Company's rental income) were unable to meet their
obligations to the Company. Property rentals from leases with Caldor and the
Conway affiliate represented approximately 63% and 13%, respectively, of the
Company's consolidated revenues for the yearfiscal years ended December 31, 19942003, 2004, 2005, 2006 and approximately 65% and 13%, respectively, of the Company's consolidated revenues
for the six months ended June 30, 1995. The Company believes that the loss of
either of these tenants would have a material adverse effect on the Company.
Caldor's filing of petitions for relief under Chapter 11 of the United States
Bankruptcy Code on September 18, 1995 may lead to the termination of, or
default under, such leases with Caldor. See "Recent Developments."
Limited Number of Properties; Geographic Concentration
The Company concentrates on the development and leasing of its nine
real estate properties, which are located in the New York Area and are subject
to fluctuations in the real estate market of, and economic conditions
particular to, the New York Area. As a result, the Company's results of
operations are dependent upon the success of a limited number of properties
and upon the demand for retail space in its market area. There can be no
assurance that local economic conditions will be favorable to the Company's
operations. An adverse development effecting any one of the Company's
properties could have a material adverse effect on the Company's financial
condition or results of operations.
Condemnation
The State of New Jersey has notified the Company of its intention to
condemn approximately ten acres or 25% of the Paramus Property in connection
with the redesign of a highway intersection. The New Jersey Department of
Transportation ("DOT") has recently made an offer to the Company to purchase
the land which is the subject of the condemnation proceeding for $15,400,000
based on an appraisal performed on the DOT's behalf. The Company expects to
continue negotiations with the DOT to attempt to reach agreement on the value.
In the event that the Company2007 and the DOT do not reach agreement on the value,
a formal process will be initiated by the DOT, pursuant to which, among other
things, a group of independent commissioners will be appointed by a court to
determine fair market value. If the condemnation occurs, the Company will be
required to change its development plansnine-month periods ended September 30, 2007 and the time and cost to develop the
Paramus Property may materially increase.
In addition, the Company believes that a portion of the Lexington
Avenue Property is being considered, along with a number of other locations,
by the Port Authority of New York and New Jersey (the "Port Authority") for
the site of the terminus for a rail link from midtown Manhattan to LaGuardia
and Kennedy Airports. If the
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project proceeds and the Port Authority selects a portion of the Lexington
Avenue Property for such use and can establish that it is needed to serve a
public use, benefit or purpose, the Port Authority, after conducting the
requisite public hearings, may acquire such portion of the Lexington Avenue
Property pursuant to its powers of eminent domain. Since the nature and scope
of any plans being considered by the Port Authority, and whether any such plans
would ultimately affect the Lexington Avenue Property, cannot be fully assessed
by the Company at this time, it is impossible to determine the ultimate effect
that a taking, or any uncertainty with respect thereto, would have on the
Company's use or development of the Lexington Avenue Property.
Environmental Matters
Under various federal, state and local laws, ordinances and
regulations, an owner or operator of real property may be liable for the costs
of removal or remediation of hazardous substances located on, under or in such
property. Such laws often impose liability whether or not the owner or
operator knew of, or was responsible for, the presence of such hazardous or
toxic substances and the liability may continue after the sale or other
disposition of the contaminated property. Other federal and state laws require
the removal or encapsulation of asbestos-containing material in the event of
remodeling, renovation or demolition. Other statutes may require the removal
of underground storage tanks that are out of service or out of compliance.
Although compliance with applicable provisions of federal, state and local laws
regulating the discharge of materials into the environment or otherwise
relating to the protection of the environment has not had a material effect on
the Company's financial condition or results of operations, there can be no
assurance that such compliance will not have such an effect in the future.
In September 1993, the Company had Phase I environmental assessments
(which generally involve site and records inspection without soil or
groundwater sampling) performed by an environmental engineering firm on each of
its properties. The results of the assessments at the Kings Plaza property
show that certain adjacent properties owned by third parties have experienced
petroleum hydrocarbon contamination. Based on this assessment and additional
investigation of the Kings Plaza property and historical operations at the
site, the Company believes there is a potential for hydrocarbon contamination
on the Kings Plaza property. However, no contamination has been found on the
property to date. If contamination is found on the property, the Company may
be required to engage in remediation activities.
In addition, there can be no assurance that the identification of new
areas of contamination, changes in the known scope of contamination, the
discovery of additional sites, or changes in cleanup requirements would not
result in material costs to the Company. The process of investigating and
remediating environmental contamination is lengthy and subject to the
uncertainties of changing legal requirements, developing technology and the
allocation of liability among potentially liable parties. The presence of
contamination, or the failure to properly remediate contamination, may also
adversely affect the Company's ability to borrow money using such real property
as collateral or to sell such property.
Uninsured Loss
The Company carries commercial liability, fire, flood, extended
coverage and rental loss insurance with respect to its properties and with
policy specifications and insured limits and deductibles customarily carried
for similar properties. There are, however, certain types of losses that are
generally not insured either because they are uninsurable or not economically
insurable. Should an uninsured loss occur, the Company could lose both its
invested capital in and anticipated profits from the property and would
continue to be obligated to repay any mortgage indebtedness on the property.
Any such loss could adversely affect the profitability and cash flow of the
Company. The Company believes its properties are adequately insured in
accordance with industry standards.
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LIMITED FINANCIAL AND OPERATING HISTORY; NONCOMPARABILITY OF FINANCIAL
INFORMATION
Prior to May 1992, the Company operated a retail department store
business. Accordingly, the Company has a limited operating history as a real
estate company upon which prospective investors may evaluate its performance.
Information reflecting the results of operations and financial condition of the
Company for periods subsequent to May 1992 are not comparable to information
for the periods prior to such date due to (i) the termination of the Company's
retail operations, including the sale of the Company's retail inventory, and
the Company's transition to real estate operations and (ii) the Company's
bankruptcy case, including the costs and expenses relating to the
administration thereof, and the payment of the Company's liabilities as a
result thereof. In addition, because the Company is in the development phase
of its real estate business, the results of operations since May 1992 may not
be indicative of the Company's future performance.
CONTROL-RELATED RISKS; POSSIBLE CONFLICTS OF INTEREST
Vornado owns 29.3% of the outstanding Common Stock of the Company,
including 27.1% purchased in March 1995. Interstate Properties, a New Jersey
general partnership ("Interstate"), which owns an additional 27.1% of the
outstanding Common Stock of the Company, owns 27.7% of the outstanding common
shares of beneficial interest of Vornado. Steven Roth, Chief Executive Officer
and a Director of the Company, is also Chairman of the Board and Chief
Executive Officer of Vornado, and the Managing General Partner of Interstate.
Mr. Roth, David Mandelbaum, Richard R. West and Russell B. Wight, members of
the Company's Board of Directors, are also Trustees of Vornado. Messrs. Roth,
Mandelbaum and Wight are the three partners of Interstate. Messrs. Roth,
Mandelbaum and Wight and Interstate own, in the aggregate, 32.6% of the
outstanding Common Shares of beneficial interest of Vornado. Further, Vornado
has provided the Company with a loan to finance its operations in the principal
amount of $45,000,000 (the subordinate portion of a $75,000,000 facility, the
balance of which was provided by an unaffiliated bank). The loan is secured by
liens on substantially all of the Company's properties.
Based on the foregoing, Mr. Roth, Interstate Properties and Vornado
(collectively, the "Principal Stockholders") may have substantial influence on
the Company and on the outcome of any matters submitted to the Company's
stockholders for approval. In addition, certain decisions concerning the
operations or financial structure of the Company may present conflicts of
interest between the Principal Stockholders and the Holders of the Securities.
For example, if the Company encounters financial difficulties, or is unable to
pay its debts as they mature, the interests of the Principal Stockholders might
conflict with those of the Holders of the Securities. In addition, the
Principal Stockholders may have an interest in pursuing acquisitions,
divestitures, financings or other transactions that, in their judgment, could
enhance their equity investment, even though such transactions might involve
risk to the Holders of the Securities. Interstate Properties, Vornado and Mr.
Roth engage in a wide variety of activities in the real estate business which
may result in conflicts of interest with respect to certain matters affecting
the Company, such as potential business opportunities, business dealings
between the Company, Interstate Properties and Vornado and their affiliates,
demands on the time of Mr. Roth and certain of the executive officers of
Vornado, changes of existing arrangements between Mr. Roth, the Company and
Vornado (such as the Management and Development Agreement, dated February 6,
1995 (the "Management and Development Agreement") and the Retention Agreement,
dated July 20, 1992 (the "Retention Agreement")), potential competition between
business activities conducted, or sought to be conducted, by the Company,
Vornado and Interstate Properties (including competition for properties and
tenants), possible corporate transactions, and other strategic decisions
affecting the Company in the future. Neither Mr. Roth nor Vornado is obligated
to present to the Company any particular investment opportunity which comes to
their attention, even if such opportunity is of a character which might be
suitable for investment by the Company.
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RELIANCE ON KEY PERSONNEL AND AGREEMENTS WITH VORNADO
The Company believes that the continued services of Steven Roth, the
Company's Chief Executive Officer, are important to the Company's future
success. Although Mr. Roth has a significant ownership interest in the
Company, there is no assurance that he will remain with the Company. In
addition, the Company has retained Vornado pursuant to the Management and
Development Agreement, to manage all of the Company's business affairs and to
manage and develop the Company's properties, and pursuant to the Retention
Agreement, to act as the Company's exclusive leasing agent with respect to all
of the Company's properties. If, for any reason, Mr. Roth and Vornado do not
continue to be active in the Company's management, the Company's operations
could be adversely affected.
CHANGES IN OPERATING OR INVESTMENT STRATEGY
The Company's operating and investment strategy and its policies with
respect to certain other activities, including growth, capitalization,
distributions and REIT status, will be determined by the Board of Directors of
the Company. The Board of Directors may amend or revise these policies from
time to time at their discretion without a vote of the stockholders of the
Company.
POSSIBILITY OF THE FAILURE TO QUALIFY OR REMAIN QUALIFIED AS A REIT
The Board of Directors of the Company has determined that the Company
should take the necessary actions to qualify as a REIT for federal income tax
purposes under the Code. Although management believes that the Company will be
organized and will operate in such a manner as to so qualify, no assurance can
be given that it will qualify or remain so qualified. Future economic, market,
legal, tax or other considerations may cause management to determine that it is
in the best interest of the Company and its stockholders to revoke the REIT
election. Qualification as a REIT for federal income tax purposes involves the
application of highly technical and complex Code provisions for which there are
only limited judicial or administrative interpretations, and the determination
of various factual matters and circumstances not entirely within the control of
the Company may affect its ability to qualify as a REIT. In addition, no
assurance can be given that legislation, new regulations, administrative
interpretations or court decisions will not significantly change the tax laws
with respect to the requirements for qualification as a REIT or the federal
income tax consequences of such qualification. The Company, however, is not
aware of any proposal to amend the tax laws that would significantly and
adversely affect its ability to operate in such a manner as to qualify as a
REIT.
In order to qualify and maintain its qualification as a REIT for
federal income tax purpose, the Company is required, among other distribution
requirements, to distribute as dividends on shares of Common Stock and/or
Preferred Stock at least 95% of its "real estate investment trust taxable
income." As of December 31, 1994, the Company had reported net operating loss
("NOL") carryovers of approximately $110 million, which generally would be
available to offset the amount of real estate investment trust taxable income
that the Company otherwise would be required to distribute. However, the NOLs
reported on the Company's tax returns are not binding on the Internal Revenue
Service (the "IRS") and are subject to adjustment as a result of future IRS
audits. In addition, under Section 382 of the Code, the Company's ability to
use its NOL carryovers could be limited if, generally, there were significant
changes in the ownership of its outstanding stock. Since its reorganization as
a REIT, the Company has not paid regular dividends and, unless otherwise
provided in an applicable Prospectus Supplement, does not believe that it will
be required to and may not pay regular dividends until its NOL carryovers have
been fully utilized on any Common Stock or Preferred Stock issued pursuant to
this Prospectus except for dividends on Preferred Stock as described in any
applicable Prospectus Supplement.
ANTI-TAKEOVER EFFECTS OF PROVISIONS OF THE CERTIFICATE OF INCORPORATION AND
BY-LAWS
Certain provisions of the Certificate of Incorporation and the By-laws
of the Company may be deemed to have anti-takeover effects and may discourage
or make more difficult a takeover attempt that a stockholder might consider in
its best interest. The Certificate of Incorporation provides that the Board of
Directors of the Company be divided into three classes serving staggered
three-year terms and that the number of directors will be no greater
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than seventeen or less than three. The classes of directors2008 are as nearly
equal in number as possible. Accordingly, approximately one-third of the
Company's Board of Directors will be elected each year. The By-laws provide
that any vacancies on the Board of Directors may only be filled by the
remaining directors and not by the stockholders. This precludes stockholders
from removing incumbent directors without cause and filling the resulting
vacancies with their own nominees. These provisions, among other things, limit
the ability of the stockholders to amend or repeal the By-laws or certain
provisions of the Certificate of Incorporation.
Additionally, for the Company to qualify as a REIT under the Code, not
more than 50% of the value of the outstanding stock may be owned, directly or
indirectly, by five or fewer individuals (as defined in the Code to include
certain entities) during the last half of a taxable year and the stock must be
beneficially owned by 100 or more persons during at least 335 days of a taxable
year of 12 months (or during a proportionate part of a shorter taxable year).
Accordingly, the Certificate of Incorporation contains provisions that restrict
the ownership and transfer of shares of capital stock. The Certificate of
Incorporation also contains provisions that restrict the ownership and transfer
of shares of capital stock to reduce the risk that the Company's ability to use
its NOLs would be limited.
RECENT DEVELOPMENTS
On September 18, 1995, Caldor filed for relief under Chapter 11 of the
United States Bankruptcy Code. Caldor leases from the Company its Fordham Road
and Flushing Properties. Property rentals from these two leases represented
approximately 63% of the Company's consolidated revenues for the year ended
December 31, 1994 and approximately 65% of the Company's consolidated revenues
for the six months ended June 30, 1995. Caldor is also the lessee of a portion
of the Rego Park I Property under a lease expected to commence upon the
completion of the redevelopment of this property planned for March 1996. The
loss of property rental payments under any of these leases with Caldor could
have a material adverse effect on the financial condition and results of
operations of the Company.
Caldor has reported to the Company store sales of $48,658,000 and
$42,047,000 for the Fordham Road Property and the Flushing Property,
respectively, for the lease years ending March 31, 1995. Management of the
Company believes that each of these stores is among the 10 highest volume
stores of Caldor. Caldor leased these properties "as is" and expended the
entire cost of refurbishing these stores.
Under the terms of a $25,000,000 loan to the Company, secured by a
mortgage on the Fordham Road Property (the "Fordham Loan"), the failure of
Caldor to meet certain financial tests may result in the Company being required
to escrow net cash flow of approximately $500,000 per annum from the Fordham
Road Property into an account of the lender as a reserve against future
payments under the loan.
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USE OF PROCEEDS
Except as otherwise provided in the applicable Prospectus Supplement,
the Company anticipates that the net proceeds of the sales of the Securities
will be used for general corporate purposes which may include, without
limitation, development of the Company's Redevelopment Properties and repayment
of outstanding indebtedness.
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
follows:
| YEAR ENDED DECEMBER 31, | NINE MONTHS ENDED SEPTEMBER 30, | |||||||||||||||||||||||||||
| 2003 | 2004 | 2005 | 2006 | 2007 | 2007 | 2008 | ||||||||||||||||||||||
| Ratio of earnings to fixed charges | -- | -- | 1.21 | -- | 2.56 | 2.47 | 1.29 | |||||||||||||||||||||
| Deficiency in earnings available to cover fixed charges | $ | (56, 464 | ) | $ | (62,418 | ) | -- | $ | (89,617 | ) | -- | -- | -- | |||||||||||||||
For purposes of calculating the followingthese ratios, (i)(a) earnings represent pretax income from continuing operations before income taxes, plus fixed charges less capitalized interest, and (ii)(b) fixed charges represent interest expense on all indebtedness
from continuing operations, (including the Company's 50% share of interest
expense in the Kings Plaza Mall andincluding amortization of deferred debt issuance costs) andcosts, plus the portion of operating lease rental expense that ismanagement considers representative of the interest factor (deemed to be one-third(one-third of operating lease rentals). plus capitalized interest. There were no shares of Preferred Stockpreference securities outstanding during anythe periods shown. The calculation of the periods
below indicatedratios and therefore the ratio of earnings to combined fixed charges
and preferred share dividend requirements would have been the same as the ratio
of earnings to fixed charges for each period indicated.
--------------------------
(1) In November 1993, the Company changed to a calendar year from a fiscal
year ending on the last Saturday in July.
(2) Includes 53 weeks.
(3) This amount includes a gain on the sale of leases of $28,779,000,
without which the Company would have had a deficiency in earnings to cover fixed charges is included as Exhibit 12 to this registration statement.
USE OF PROCEEDS
Except as may be described otherwise in a prospectus supplement, we expect to use the net proceeds from the sale of $1,628,000.
the securities offered by this prospectus for general corporate purposes, which may include redevelopment of our properties and the repayment of our outstanding indebtedness.
6
DESCRIPTION OF DEBT SECURITIES
The Debt Securities may be
Please note that in this section references to “Alexander’s,” “we,” “our” and “us” refer to Alexander’s, Inc. and its consolidated subsidiaries unless the context requires otherwise. Also, in this section, references to “holders” mean those who own debt securities registered in their own names, on the books that we or the trustee maintain for this purpose, and not those who own beneficial interests in debt securities registered in street name or in debt securities issued from time to time in book-entry form through one or more series. The particular termsdepositaries. Owners of each series of Debt Securities offeredbeneficial interests in the debt securities should see “Legal Ownership and Book-Entry Issuance” for more information.
DEBT SECURITIES MAY BE SENIOR OR SUBORDINATED
We may issue senior or subordinated debt securities. Neither the senior debt securities nor the subordinated debt securities will be secured by any Prospectus Supplementof our property or Prospectus Supplementsassets. Thus, by owning a debt security, you are an unsecured creditor of ours.
The senior debt securities will be described therein. The
Senior Debt Securities are to be issued under an Indenture (the "Senior
Indenture") between the Companyour senior debt indenture described below and State Street Bank & Trust Company, N.A.,
as trustee (the "Senior Trustee"). will rank equally with all of our other unsecured and unsubordinated debt.
The Subordinated Debt Securities are tosubordinated debt securities will be issued under a separate Indenture (the "Subordinated Indenture") betweenour subordinated debt indenture described below and will be subordinate in right of payment to all of our “senior indebtedness,” as defined in the Companysubordinated debt indenture. The prospectus supplement for any series of subordinated debt securities or the information incorporated in this prospectus by reference will indicate the approximate amount of senior indebtedness outstanding as of the end of our most recent fiscal quarter. We did not have any senior indebtedness outstanding as of September 30, 2008. Neither indenture limits our ability to incur additional senior indebtedness, unless otherwise described in the prospectus supplement relating to any series of debt securities. Our senior indebtedness is, and State Street Bank & Trust Company, N.A, as trustee (the
"Subordinated Trustee"). The Senior Indentureany additional senior indebtedness will be, structurally subordinate to the indebtedness of our subsidiaries.
When we refer to “debt securities” in this prospectus, we mean both the senior debt securities and the Subordinated Indenture
are sometimes referred to collectively as the "Indentures"subordinated debt securities.
THE SENIOR DEBT INDENTURE AND THE SUBORDINATED DEBT INDENTURE
The senior debt securities and the Senior
Trustee and Subordinated Trusteesubordinated debt securities are sometimes referred to collectively aseach governed by a document called an indenture, the "Trustees."
The following summaries of certain provisionssenior debt indenture, in the case of the Senior Debt
Securities, the Subordinated Debt Securities, the Senior Indenturesenior debt securities, and the Subordinated Indenture,subordinated debt indenture, in the case of the subordinated debt securities. Each indenture is a contract between Alexander’s, Inc. and The Bank of New York Mellon, which will initially act as modified or superseded by any applicable Prospectus
Supplement,trustee. The indentures are brief summaries of certain provisions thereof, do not purport
to be complete and are subject, and are qualified in their entirety by
reference, to allsubstantially identical, except for the provisions relating to subordination, which are included only in the subordinated debt indenture.
The trustee under each indenture has two main roles:
| · | First, the trustee can enforce your rights against us if we default. There are some limitations on the extent to which the trustee acts on your behalf, which we describe later under “—Default, Remedies and Waiver of Default.” |
| · | Second, the trustee performs administrative duties for us, such as sending interest payments and notices. |
See “—Our Relationship with the Trustee” below for more information about the trustee.
When we refer to the indenture or the trustee with respect to any debt securities, we mean the indenture under which those debt securities are issued and the trustee under that indenture.
WE MAY ISSUE MANY SERIES OF DEBT SECURITIES
We may issue as many distinct series of debt securities as we wish under either indenture. This section of the Indenture applicable to a particular
series of Debt Securities. Wherever particular Sections, Articles or definedprospectus summarizes terms of the Indentures are referreddebt securities that apply generally to hereinall series. The provisions of each indenture allow us not only to issue debt securities with terms different from those of debt securities previously issued under that indenture, but also to “reopen” a previous issue of a series of debt securities and issue additional debt securities of that series. We will describe most of the financial and other specific terms of a series, whether it is
7
a series of the senior debt securities or in a Prospectus Supplement,
such Sections, Articles or defined terms are incorporated herein or therein by
reference.
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GENERAL
Unless otherwise specifiedsubordinated debt securities, in the prospectus supplement accompanying this prospectus. If there are any differences between your prospectus supplement and this prospectus, your prospectus supplement will control. Thus, the statements we make in this section may not apply to your debt security.
When we refer to a series of debt securities, we mean a series issued under the applicable Prospectus Supplement,indenture. When we refer to your prospectus supplement, we mean the Debt Securities will be general unsecured obligationsprospectus supplement describing the specific terms of the Company.debt security you purchase. The Indentures do not limitterms used in your prospectus supplement have the meanings described in this prospectus, unless otherwise specified.
AMOUNTS THAT WE MAY ISSUE
Neither indenture limits the aggregate amount of Debt Securities whichdebt securities that we may be
issued thereunder,issue or the number of series or the aggregate amount of any particular series. We may issue debt securities and Debt Securities may be issued thereunder from time to
timeother securities in separate seriesamounts that exceed the total amount specified on the cover of this prospectus up to the aggregate amount from time to time authorized by the Companyour board of directors for each series. Unlessseries, at any time without your consent and without notifying you.
The indentures and the debt securities do not limit our ability to incur other indebtedness or to issue other securities, unless otherwise specifieddescribed in the Prospectus
Supplement,prospectus supplement relating to any series of debt securities. Also, we are not subject to financial or similar restrictions by the Senior Debt Securities when issued will be unsubordinated
obligations of the Company and will rank equally and ratably with all other
unsecured and unsubordinated indebtedness of the Company. The Subordinated Debt
Securities when issued will be subordinated in right of payment to the prior
payment in full of all Senior Debt (as defined in the Subordinated Indenture)
of the Company as described below under "-- Subordination of Subordinated Debt
Securities" and in the Prospectus Supplement applicable to an offering of
Subordinated Debt Securities.
The applicable Prospectus Supplement or Prospectus Supplements will
describe the following terms of the debt securities, unless otherwise described in the prospectus supplement relating to any series of Debt Securities in respect of
which this Prospectus is being delivered: (1) the title of such Debt
Securities; (2) any limit on the aggregatedebt securities.
PRINCIPAL AMOUNT, STATED MATURITY AND MATURITY
The principal amount of such Debt
Securities; (3) the person to whom any interest on any Debt Security of the
series shall be payable if other than the person in whose name the Debt
Security is registered on the regular record date; (4) the date or dates on
which such Debt Securities will mature; (5) the rate or rates of interest, if
any, or the method of calculation thereof, which such Debt Securities will
bear, the date or dates from which any such interest will accrue, the interest
payment dates on which any such interest on such Debt Securities will be
payable and the regular record date for any interest payable on any interest
payment date; (6) the place or places where the principal of, premium, if any,
and interest on such Debt Securities will be payable; (7) the period or periods
within which, the events upon the occurrence of which, and the price or prices
at which, such Debt Securities may, pursuant to any optional or mandatory
provisions, be redeemed or purchased, in whole or in part, by the Company and
any terms and conditions relevant thereto; (8) the obligations of the Company,
if any, to redeem or repurchase such Debt Securities pursuant to any sinking
fund provision or analogous provision or at the option of the Holders and the
period or periods within which, and the other terms and conditions upon which,
such Debt Securities shall be redeemed, repaid or repurchased, in whole or in
part, pursuant to such obligations; (9) the denominations in which any such
Debt Securities will be issuable, if other than denominations of $1,000 and any
integral multiple thereof; (10) any index or formula used to determine the
amount of payments of principal of and any premium and interest on such Debt
Securities; (11) the currency, currencies or currency unit or units of payment
of principal of and any premium and interest on such Debt Securities if other
than U.S. dollars; (12) if the principal of, or premium, if any, or interest on
such Debt Securities is to be payable, at the election of the Company or a Holder thereof, in one or more currencies or currency units other than that or
those in which such Debt Securities are stated to be payable, the currency,
currencies or currency units in which payment of the principal of and any
premium and interest on Debt Securities of such series as to which such
election is made shall be payable, and the periods within which and the terms
and conditions upon which such election is to be made; (13) if other thandebt security means the principal amount thereof, the portion ofpayable at its stated maturity, unless that amount is not determinable, in which case the principal amount of such Debt
Securitiesa debt security is its face amount. Any debt securities owned by us or any of our affiliates are not deemed to be outstanding for certain determinations under the seriesindenture.
The term “stated maturity” with respect to any debt security means the date on which will be payable upon acceleration of the
maturity thereof; (14) if the principal amount of any Debt Securitiesthe debt security is scheduled to become due. The principal may become due sooner, by reason of redemption or acceleration after a default or otherwise in accordance with the terms of the debt security. The date on which will be payablethe principal actually becomes due, whether at the stated maturity thereof will not be determinable asor earlier, is called the “maturity” of any date
prior to such maturity, the amount which will be deemed to be the outstanding
principal amount of such Debt Securities; (15) the applicability of any
provisions described below under "Defeasance"; (16) whether any of such Debt
Securities are to be issuable in permanent global form ("Global Security") and,
if so,principal.
We also use the terms “stated maturity” and conditions, if any, upon which“maturity” to refer to the dates when other payments become due. For example, we refer to a regular interest payment date when an installment of interest is scheduled to become due as the “stated maturity” of that installment.
When we refer to the “stated maturity” or the “maturity” of a debt security without specifying a particular payment, we mean the stated maturity or maturity, as the case may be, of the principal.
OUR DEBT SECURITIES ARE STRUCTURALLY SUBORDINATED TO THE INDEBTEDNESS OF OUR SUBSIDIARIES
Because our assets consist principally of interests in such
Securities in global form may be exchanged, in whole or in part, for the individual Debt Securities represented thereby; (17) the applicability of any
covenant with respect to such Debt Securitiessubsidiaries through which we own our properties and the applicability of any
provisions described below under "Events of Default" and any additional Events
of Default applicable thereto; (18) any covenants applicable to such Debt
Securities; (19) the terms and conditions, if any, pursuant to which the Debt
Securities are convertible or exchangeable into shares of Common Stock or other
securities; and (20) any other terms of such Debt Securities not inconsistent
with the provisions of the Indentures. (Section 301) Debt Securities may also
be issued under the Indentures upon the exercise of Debt Warrants. See
"Description of Debt Warrants."
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Debt Securities may be issued at a discount from their principal
amount. United States federal income tax considerations and other special
considerations applicable to any such original issue discount Securities will
be described in the applicable Prospectus Supplement.
If the purchase price of any of the Debt Securities is denominated in
a foreign currency or currencies or a foreign currency unit or units or if the
principal of and any premium and interest on any series of Debt Securities is
payable in a foreign currency or currencies or a foreign currency unit or
units, the restrictions, elections, general tax considerations, specific terms
and other information with respect to such issue of Debt Securities will be set
forth in the applicable Prospectus Supplement.
Since the Company is a holding company, the rights of the Company, and
hence theconduct our businesses, our right of creditors of the Company (including the Holders of Debt
Securities), to participate as an equity holder in any distribution of the assets of any subsidiaryof our subsidiaries upon itsthe subsidiary’s liquidation or reorganization or otherwise, and thus the ability of our security holders to benefit from the distribution, is necessarily subjectjunior to
the prior claims of creditors of any suchthe subsidiary, except to the extent that any claims of the Company itselfwe may have as a creditor of the subsidiary may be recognized. We may also guarantee some obligations of our subsidiaries. Any liability we may have for our subsidiaries’ obligations could reduce our assets that are available to satisfy our direct creditors, including investors in our debt securities.
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THIS SECTION IS ONLY A SUMMARY
The Indenturesindentures and their associated documents, including your debt security, contain the full legal text of the matters described in this section and your prospectus supplement. We have filed forms of the indentures as exhibits to our registration statement of which this prospectus is a part. See “Available Information” for information on how to obtain copies of them.
This section and your prospectus supplement summarize all the material terms of the indentures and your debt security. They do not, contain any provisionshowever, describe every aspect of the indentures and your debt security. For example, in this section and your prospectus supplement, we use terms that limithave been given special meaning in the Company's
abilityindentures, but we describe the meaning for only the more important of those terms.
GOVERNING LAW
The indentures and the debt securities will be governed by New York law.
CURRENCY OF DEBT SECURITIES
Amounts that become due and payable on a debt security in cash will be payable in a currency, currencies or currency units specified in the accompanying prospectus supplement. We refer to incur indebtedness. Holdersthis currency, currencies or currency units as the “specified currency.” The specified currency for a debt security will be U.S. dollars, unless your prospectus supplement states otherwise. Some debt securities may have different specified currencies for principal and interest. You will have to pay for your debt securities by delivering the requisite amount of Debt Securities will not have the benefit of any specific covenantsspecified currency for the principal to us or provisionsthe underwriters, agents or dealers that we name in the applicable Indentureprospectus supplement, unless other arrangements have been made between you and us or Debt Securities that would protect themyou and such firm. We will make payments on a debt security in the eventspecified currency, except as described below in “—Payment Mechanics for Debt Securities.”
FORM OF DEBT SECURITIES
We will issue each debt security in global, i.e., book-entry form only, unless we specify otherwise in the Company engagesapplicable prospectus supplement. Debt securities in or
becomesbook-entry form will be represented by a global security registered in the subjectname of a highly leveraged transaction, other thandepositary, which will be the holder of all the debt securities represented by that global security. Those who own beneficial interests in a global debt security will do so through participants in the depositary’s securities clearance system, and the rights of these indirect owners will be governed solely by the applicable procedures of the depositary and its participants. We describe book-entry securities below under “— Legal Ownership and Book-Entry Issuance.”
In addition, we will issue each debt security in fully registered form, without coupons.
TYPES OF DEBT SECURITIES
We may issue any covenantsof the following types of senior debt securities or subordinated debt securities:
Fixed Rate Debt Securities
A debt security of this type will bear interest at a fixed rate described in the applicable prospectus supplement. This type includes zero coupon debt securities, which bear no interest and are instead issued at a price usually significantly lower than the principal amount. See “—Original Issue Discount Debt Securities” below for more information about zero coupon and other original issue discount debt securities.
Each fixed rate debt security, except any Prospectus Supplement,zero coupon debt security, will bear interest from its original issue date or from the most recent date to which interest on the debt security has been paid or made available for payment. Interest will accrue on the principal of a fixed rate debt security at the fixed yearly rate stated in the applicable prospectus supplement, until the principal is paid or made available for payment or the debt security is exchanged. Each payment of interest due on an interest payment date or the date of maturity will include interest accrued from and including the limitationslast date to which interest has been paid, or made available for payment, or from the issue date if none has been paid, or made available for payment, to but excluding the interest payment date or the date of
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maturity. We will compute interest on mergers,
consolidationsfixed rate debt securities on the basis of a 360-day year of twelve 30-day months. We will pay interest on each interest payment date and transfers of substantially all of the Company's properties
and assets as an entirety to any personat maturity as described below under "--
Consolidation, Merger“—Payment Mechanics for Debt Securities.”
Floating Rate Debt Securities
A debt security of this type will bear interest at rates that are determined by reference to an interest rate formula. In some cases, the rates also may be adjusted by adding or subtracting a spread or multiplying by a spread multiplier and Salemay be subject to a minimum rate or a maximum rate. If a debt security is a floating rate debt security, the formula and any adjustments that apply to the interest rate will be specified in the applicable prospectus supplement.
Each floating rate debt security will bear interest from its original issue date or from the most recent date to which interest on the debt security has been paid or made available for payment. Interest will accrue on the principal of Assets." Such covenants may not be waiveda floating rate debt security at the yearly rate determined according to the interest rate formula stated in the applicable prospectus supplement, until the principal is paid or modified bymade available for payment or the Company or its Board of Directors, although Holders of Debt
Securities could waive or modify such covenantssecurity is exchanged. We will pay interest on each interest payment date and at maturity as more fully described below under "-- Modification“—Payment Mechanics for Debt Securities.”
Calculation of Interest. Calculations relating to floating rate debt securities will be made by the calculation agent, an institution that we appoint as our agent for this purpose. The prospectus supplement for a particular floating rate debt security will name the institution that we have appointed to act as the calculation agent for that debt security as of its original issue date. We may appoint a different institution to serve as calculation agent from time to time after the original issue date of the debt security without your consent and Waiver."
CONVERSION OR EXCHANGE OF DEBT SECURITIES
If so indicatedwithout notifying you of the change.
For each floating rate debt security, the calculation agent will determine, on the corresponding interest calculation or determination date, as described in the applicable Prospectus Supplementprospectus supplement, the interest rate that takes effect on each interest reset date. In addition, the calculation agent will calculate the amount of interest that has accrued during each interest period, i.e., the period from and including the original issue date, or the last date to which interest has been paid or made available for payment, to but excluding the payment date. For each interest period, the calculation agent will calculate the amount of accrued interest by multiplying the face or other specified amount of the floating rate debt security by an accrued interest factor for the interest period. This factor will equal the sum of the interest factors calculated for each day during the interest period. The interest factor for each day will be expressed as a decimal and will be calculated by dividing the interest rate, also expressed as a decimal, applicable to that day by 360 or by the actual number of days in the year, as specified in the applicable prospectus supplement.
Upon the request of the holder of any floating rate debt security, the calculation agent will provide for that debt security the interest rate then in effect and, if determined, the interest rate that will become effective on the next interest reset date. The calculation agent’s determination of any interest rate, and its calculation of the amount of interest for any interest period, will be final and binding in the absence of manifest error.
All percentages resulting from any calculation relating to a debt security will be rounded upward or downward, as appropriate, to the next higher or lower one hundred-thousandth of a percentage point, e.g., 9.876541% (or .09876541) being rounded down to 9.87654% (or .0987654) and 9.876545% (or .09876545) being rounded up to 9.87655% (or .0987655). All amounts used in or resulting from any calculation relating to a floating rate debt security will be rounded upward or downward, as appropriate, to the nearest cent, in the case of U.S. dollars, or to the nearest corresponding hundredth of a unit, in the case of a currency other than U.S. dollars, with one-half cent or one-half of a corresponding hundredth of a unit or more being rounded upward.
In determining the base rate that applies to a floating rate debt security during a particular interest period, the calculation agent may obtain rate quotes from various banks or dealers active in the relevant market, as described in the applicable prospectus supplement. Those reference banks and dealers may include the calculation agent itself and its affiliates, as well as any underwriter, dealer or agent participating in the distribution of the relevant floating rate debt securities and its affiliates.
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Indexed Debt Securities
A debt security of this type provides that the principal amount payable at its maturity, and the amount of interest payable on an interest payment date, will be determined by reference to:
| · | securities of one or more issuers, |
| · | one or more currencies, |
| · | one or more commodities, |
| · | any other financial, economic or other measure or instrument, including the occurrence or nonoccurrence of any event or circumstance, or |
| · | one or more indices or baskets of the items described above. |
If you are a holder of an indexed debt security, you may receive an amount at maturity that is greater than or less than the face amount of your debt security depending upon the value of the applicable index at maturity. The value of the applicable index will fluctuate over time.
If you purchase an indexed debt security, your prospectus supplement will include information about the relevant index and about how amounts that are to become payable will be determined by reference to the price or value of that index. The prospectus supplement will also identify the calculation agent that will calculate the amounts payable with respect to the indexed debt security and may exercise significant discretion in doing so.
Original Issue Discount Debt Securities
A fixed rate debt security, a floating rate debt security or an indexed debt security may be an original issue discount debt security. A debt security of this type is issued at a price lower than its principal amount and provides that, upon redemption or acceleration of its maturity, an amount less than its principal amount will be payable. An original issue discount debt security may be a zero coupon debt security. A debt security issued at a discount to its principal amount may, for Federal income tax purposes, be considered an original issue discount debt security, regardless of the amount payable upon redemption or acceleration of maturity. The Federal income tax consequences of owning an original issue discount debt security may be described in the applicable prospectus supplement.
INFORMATION IN THE PROSPECTUS SUPPLEMENT
A prospectus supplement will describe the specific terms of a particular series of Debt Securities, such seriesdebt securities, which will be convertibleinclude some or exchangeable into shares of Common Stock or other securities on the terms and
conditions set forth therein. Such terms shall include provisions as to whether
conversion is mandatory, at the optionall of the Holder or at the option of the
Company, and may include provisions pursuant to which the number of shares of
Common Stock or other securities of the Company to be received by the Holders
of Debt Securities would be calculated according to the market price of the
Common Stock or other securities of the Company as of a time stated in the
Prospectus Supplement. The applicable Prospectus Supplement will indicate
certain restrictions on ownership which may apply in the event of a conversion
or exchange. See "Description of Preferred Stock -- Restrictions on Ownership"
and "Description of Common Stock -- Restrictions on Ownership."
FORM, EXCHANGE, REGISTRATION, CONVERSION, TRANSFERfollowing:
| · | the title of the debt securities, |
| · | whether they are senior debt securities or subordinated debt securities, |
| · | any limit on the aggregate principal amount of the debt securities of the same series, |
| · | the person to whom any interest on a debt security of the series will be payable, if other than the person in whose name the debt security is registered at the close of business on the regular record date, |
| · | the stated maturity, |
| · | the specified currency, currencies or currency units for principal and interest, if not U.S. dollars, |
| · | the price at which we originally issue the debt securities, expressed as a percentage of the principal amount, and the original issue date, |
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| · | whether the debt securities are fixed rate debt securities, floating rate debt securities or indexed debt securities, |
| · | if the debt securities are fixed rate debt securities, the yearly rate at which the debt securities will bear interest, if any, and the interest payment dates, |
| · | the regular record date for any interest payable on any interest payment date, |
| · | the place or places where the principal of, premium, if any, and interest on the debt securities will be payable, |
| · | the denominations in which the debt securities will be issuable, if other than denominations of $1,000 and any integral multiple of $1,000, |
| · | if the debt securities are floating rate debt securities, the interest rate basis, any applicable index currency or maturity, spread or spread multiplier or initial, maximum or minimum rate, the interest reset, determination, calculation and payment dates, the day count used to calculate interest payments for any period, and the calculation agent, |
| · | any index or formula used to determine the amount of payments of principal of and any premium and interest on the debt securities, |
| · | if the debt securities may be exchanged for shares of our common or preferred stock or any securities of another person, the terms on which exchange may occur, including whether exchange is mandatory, at the option of the holder or at our option, |
| · | if the debt securities are original issue discount debt securities, the yield to maturity, |
| · | if other than the principal amount, the portion of the principal amount of the debt securities of the series which will be payable upon acceleration of the maturity of the debt securities, |
| · | if applicable, the circumstances under which the debt securities may be mandatorily redeemed by us, redeemed at our option or repaid at the holder’s option before the stated maturity, including any redemption commencement date, repayment date(s), redemption price(s) and redemption period(s), |
| · | if the principal amount of the debt securities which will be payable at the maturity of the debt securities will not be determinable as of any date before maturity, the amount which will be deemed to be the outstanding principal amount of the debt securities, |
| · | the applicability of any provisions described under “—Defeasance and Covenant Defeasance,” |
| · | the depositary for the debt securities, if other than the Depository Trust Company, known as DTC, and any circumstances under which the holder may request securities in non-global form, |
| · | the applicability of any provisions described under “—Default, Remedies and Waiver of Default,” |
| · | any additional covenants applicable to the debt securities and any elimination of or modification to the covenants described under “—Covenants,” |
| · | the names and duties of any co-trustees, depositaries, authenticating agents, paying agents, transfer agents or registrars for the debt securities, |
| · | the Federal income tax consequences to holders of fixed rate debt securities that are zero coupon or original issue discount debt securities, floating rate debt securities or indexed debt securities, and |
| · | any other terms of the debt securities, which could be different from those described in this prospectus. |
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REDEMPTION AND PAYMENT
REPAYMENT
Unless otherwise indicated in the applicable Prospectus Supplement,
the Debt Securities will be issued only in fully registered form in
denominations of $1,000 or integral multiples thereof. (Section 302) Unless
otherwise indicated in the applicable Prospectus Supplement, payment of
principal, premium, if any, and interest on the Debt Securities will be
payable, and the exchange, conversion and transfer of Debt Securities will be
registerable, at the office or agency of the Company maintained for such
purposes and at any other office or agency maintained for such purpose.
(Sections 301, 305 and 1002) No service charge will be made for any
registration of transfer or exchange of the Debt Securities, but the Company
may require payment ofprospectus supplement, a sum sufficient to cover any tax or other governmental
charge imposed in connection therewith. (Section 305)
All monies paid by the Company to a Paying Agent for the payment of
principal of and any premium or interest on any Debt Security which remain
unclaimed for two years after such principal, premium or interest has become
due and payable may be repaid to the Company and thereafter the Holder of such
Debt Security may look only to the Company for payment thereof. (Section 1003)
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BOOK-ENTRY DEBT SECURITIES
The Debt Securities of a series may be issued in whole or in part in
the form of one or more Global Securities that will be deposited with, or on
behalf of, a depositary (the "Global Depositary") or its nominee identified in
the applicable Prospectus Supplement. In such a case, one or more Global
Securities will be issued in a denomination or aggregate denomination equal to
the portion of the aggregate principal amount of Outstanding Debt Securities of
the series to be represented by such Global Security or Securities. Unless and
until it is exchanged in whole or in part for Debt Securities in registered
form, a Global Security may not be registered for transfer or exchange except
as a whole by the Global Depositary for such Global Security to a nominee of
such Global Depositary or by a nominee of such Global Depositary to such Global
Depositary or another nominee of such Global Depositary or by such Global
Depositary or any nominee to a successor Global Depositary or a nominee of such
successor Global Depositary and except in the circumstances described in the
applicable Prospectus Supplement. (Sections 204 and 305)
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in the applicable Prospectus Supplement. The Company expects
that the following provisions will apply to depositary arrangements, although
no assurance can be given that such will be the case.
Unless otherwise specified in the applicable Prospectus Supplement,
Debt Securities which are to be represented by a Global Security to be
deposited with or on behalf of a Global Depositary will be represented by a
Global Security registered in the name of such Global Depositary or its
nominee. Upon the issuance of such Global Security, and the deposit of such
Global Security with or on behalf of the Global Depositary for such Global
Security, the Global Depositary will credit, on its book-entry registration and
transfer system, the respective principal amounts of the Debt Securities
represented by such Global Security to the accounts of institutions that have
accounts with such Global Depositary or its nominee ("participants"). The
accounts to be credited will be designated by the underwriters or agents for
the sale of such Debt Securities or by the Company, if such Debt Securities are
offered and sold directly by the Company. Ownership of beneficial interest in
such Global Security will be limited to participants or Persons that may hold
interests through participants. Ownership of beneficial interests by
participants in such Global Security will be shown on, and the transfer of that
ownership interest will be effected only through, records maintained by the
Global Depositary or its nominee for such Global Security. Ownership of
beneficial interests in such Global Security by Persons that hold through
participants will be shown on, and the transfer of such ownership interests
within such participant will be effected only through, records maintained by
such participant. The laws of some jurisdictions require that certain
purchasers of securities take physical delivery of such securities in
certificated form. The foregoing limitations and such laws may impair the
ability to transfer beneficial interests in such Global Securities.
So long as the Global Depositary for a Global Security, or its
nominee, is the registered owner of such Global Security, such Global
Depositary or such nominee, as the case may be, will be considered the sole
owner or Holder of the Securities represented by such Global Security for all
purposes under the applicable Indenture. Except as set forth below, unless
otherwise specified in the applicable Prospectus Supplement, owners of
beneficial interests in such Global Securitydebt security will not be entitled to have Debt
Securitiesthe benefit of the series represented by such Global Security registered in
their names,any sinking fund. That is, we will not receive ordeposit money on a regular basis into any separate custodial account to repay the debt securities. In addition, we will not be entitled to receive physical delivery of
Debt Securities of such series in certificated form andredeem a debt security before its stated maturity unless the applicable prospectus supplement specifies a redemption commencement date. You will not be considered
the Holders thereof for any purposes under the applicable Indenture. (Sections
204 and 305) Accordingly, each Person owning a beneficial interest in such
Global Security must rely on the procedures of the Global Depositary and, if
such Person is not a participant, on the procedures of the participant through
which such Person owns its interest, to exercise any rights of a Holder under
the applicable Indenture. The Company understands that under existing industry
practices, if the Company requests any action of Holders or an owner of a
beneficial interest in such Global Security desires to give any notice or take
any action a Holder is entitled to give or take under the applicable Indenture,
the Global Depositary would authorize the participantsrequire us to give such notice or
take such action, and participants would authorize beneficial owners owning
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through such participants to give such notice or take such action or would
otherwise act upon the instructions of beneficial owners owning through them.
If the Global Depositary for Debt Securities ofbuy a series is at any
time unwilling, unable or ineligible to continue as Global Depositary and a
successor Global Depositary is not appointed by the Company within 90 days or
an Event of Default under the applicable Indenture has occurred and is
continuing, the Company will issue Debt Securities of such series in definitive
form in exchange for the Global Security or Securities representing the Debt
Securities of such series. In addition, the Company may at any time and indebt security from you before its sole discretion, subject to any limitations described in the applicable
Prospectus Supplement, determine not to have any Debt Securities of a series
represented bystated maturity unless your prospectus supplement specifies one or more Global Securities and, in such event,repayment dates.
If your applicable prospectus supplement specifies a redemption commencement date or a repayment date, it also will issue
Debt Securities of such series in definitive form in exchange for the Global
Securityspecify one or Securities representing such Debt Securities. Further, if the
Company so specifies with respect to the Debt Securities of a series, an owner
of a beneficial interest in a Global Security representing Debt Securities of
such series may, on terms acceptable to the Company and the Global Depositary
for such Global Security, receive Debt Securities of such series in definitive
form in exchange for such beneficial interests, subject to any limitations
described in the applicable Prospectus Supplement relating to such Debt
Securities. In any such instance, an owner of a beneficial interest in a Global
Security will be entitled to physical delivery in definitive form of Debt
Securities of the series represented by such Global Security equal in principal
amount to such beneficial interest and to have such Debt Securities registered
in its name (if the Debt Securities of such series are issuable as registered
securities).
Principal of and any premium and interest on a Global Security will be
payable in the manner described in the applicable Prospectus Supplement.
CERTAIN COVENANTS OF THE COMPANY
If so indicated in the applicable Prospectus Supplement with respect
to a particular series of Debt Securities, the Company will be subject to the
covenants described therein.
EVENTS OF DEFAULT
The following are Events of Default under the Indentures with respect
to Debt Securities of any series: (a) failure to pay principal ofmore redemption prices or premium,
if any, on any Debt Security of that series when due; (b) failure to pay any
interest on any Debt Security of that series when due, continued for 30 days;
(c) failure in the deposit of any sinking fund payment in respect of any Debt
Security of that series; (d) failure to perform any other covenant of the
Company in the Indentures (other than a covenant included in the applicable
Indenture solely for the benefit of a series of Debt Securities other than that
series), continued for 60 days after written notice to the Company as provided
in the applicable Indenture; (e) the acceleration of, or failure to pay at
maturity (including any applicable grace period), any indebtedness for money
borrowed by the Company with at least $50,000,000 in principal amount
outstanding,repayment prices, which acceleration or failure to pay is not rescinded or annulled
or such indebtedness paid, in each case within 10 days after the date on which
written notice thereof shall have first been given to the Company as provided
in the applicable Indenture; (f) certain events of bankruptcy, insolvency or
reorganization; and (g) any other Event of Default provided with respect to
Debt Securities of that series. (Section 501)
If an Event of Default with respect to Outstanding Debt Securities of
any series shall occur and be continuing, either the applicable Trustee or the
Holders of not less than 25% in principal amount of the Outstanding Debt
Securities of that series by notice as provided in the Indentures may declare
the principal amount (or, if the Debt Securities of that series are Original
Issue Discount Securities, such portion of the principal amount as may be specified in the termsexpressed as a percentage of that series) of all Debt Securities of that series to
be due and payable immediately. However, at any time after a declaration of
acceleration with respect to Debt Securities of any series has been made, but
before a judgment or decree based on such acceleration has been obtained, the
Holders of a majority in principal
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amount of the Outstanding Debt Securities of that series may, under certain
circumstances, rescind and annul such acceleration. (Section 502) For
information as to waiver or defaults, see "-- Modification and Waiver" below.
The Indentures provide that, subject to the duty of the applicable
Trustee thereunder during an Event of Default to act with the required standard
of care, such Trustee will be under no obligation to exercise any of its rights
or powers under the applicable Indenture at the request or direction of any of
the Holders, unless such Holders shall have offered to such Trustee reasonable
security or indemnity. (Sections 601 and 603) Subject to certain provisions,
including those requiring security or indemnification of the Trustees, the
Holders of a majority in principal amount of the Outstanding Debt Securities of
any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustees, or
exercising any trust or power conferred on such Trustees, with respect to the
Debt Securities of that series. (Section 512)
No Holder of a Debt Security of any series will have any right to
institute any proceeding with respect to the Indentures or for any remedy
thereunder, unless (i) such Holder shall have previously given to the
applicable Trustee written notice of a continuing Event of Default (as defined)
with respect to Debt Securities of that series; (ii) the Holders of not less
than 25% in aggregate principal amount of the Outstanding Debt Securities of
the same series shall have made written request, and offered reasonable
indemnity, to the applicable Trustee to institute proceedings in respect of
such Event of Default in its own name as trustee under the applicable
Indenture; (iii) the Trustee shall have failed to institute such proceedings
within 60 days; and (iv) the Trustee shall not have received from the Holders
of a majority in aggregate principal amount of the outstanding Debt Securities
of the same series a direction inconsistent with such request (Section 507);
provided, however, that such limitations do not apply to a suit instituted by a
Holder of a Debt Security for enforcement of payment of the principal of and
any premium and interest on such Debt Security on or after the respective due
dates expressed in such Debt Security, or in the case of convertible Debt
Securities, for enforcement of a right of conversion. (Section 508)
The Company will be required to furnish to the Trustees annually a
statement as to the performance by the Company of its obligations under the
Indentures and as to any default in such performance. (Section 1004)
MODIFICATION AND WAIVER
Without the consent of any Holder of Outstanding Debt Securities, the
Company and the applicable Trustee may amend or supplement the applicable
Indenture or Debt Securities to cure any ambiguity, defect or inconsistency, or
to make any change that does not materially adversely affect the rights of any
Holder of Debt Securities. (Section 901) Other modifications and amendments of
the Indentures may be made by the Company and the applicable Trustee only with
the consent of the Holders of not less than a majority in aggregate principal
amount of the Outstanding Debt Securities of each series affected thereby;
provided, however, that no such modification or amendment may, without the
consent of the Holder of each Outstanding Debt Security affected thereby: (a)
change the Stated Maturity of the principal of, or any installment of principal
of, or interest on, any Debt Security; (b) reduce the principal amount of the rate of interest on,debt security. It also may specify one or the premium, if any, payable uponmore redemption periods during which the redemption or
repurchaseprices relating to a redemption of debt securities during those periods will apply.
If we redeem less than all the debt securities of any Debt Security; (c) reduceseries, we will, at least 60 days before the redemption date set by us or any shorter period that is satisfactory to the trustee, notify the trustee of the redemption date, of the principal amount of principal of an
Original Issue Discount Security payable upon accelerationdebt securities to be redeemed and, if applicable, of the Maturity
thereof; (d) changetenor of the place or currencydebt securities to be redeemed. The trustee will select from the outstanding securities of payment of principal of, or
premium, if any, or interest on any Debt Security; (e) impair the rightseries the particular debt securities to institute suit forbe redeemed not more than 60 days before the enforcement of any payment on or with respectredemption date. This procedure will not apply to any Debt Securityredemption of a single debt security.
If your prospectus supplement specifies a redemption commencement date, the debt security will be redeemable at our option at any time on or after that date or at a specified time or times. If we redeem the Stated Maturity or Redemption Date thereof; (f)
modifydebt security, we will do so at the conversion provisions applicable to convertible Debt Securities in a
manner adversespecified redemption price, together with interest accrued to the Holders thereof; (g) modifyredemption date. If different prices are specified for different redemption periods, the subordination provisions
applicable to any series of Debt Securities in a manner adverseprice we pay will be the price that applies to the Holders
thereof; or (h) reduceredemption period during which the percentage in principal amountdebt security is redeemed.
If your prospectus supplement specifies a repayment date, the debt security will be repayable at the holder’s option on the specified repayment date at the specified repayment price, together with interest accrued to the repayment date.
If we exercise an option to redeem any debt security, we will give to the holder written notice of Outstanding Debt
Securities of any series, the consent of the Holders of which is required for
modification or amendment of the Indentures or for waiver of compliance with
certain provisions of the applicable Indenture or for waiver of certain
defaults. (Section 902)
The Holders of at least a majority in aggregate principal amount of the Outstanding Debt Securities of any series may on behalf of the Holders of
all Debt Securities of that series waive, insofar as that series is concerned,
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compliance by the Company with certain covenants of the Indentures. (Section
1008) The Holders ofdebt security to be redeemed, not less than a majority in principal amount of the
Outstanding Debt Securities of any series may, on behalf of the Holders of all
Debt Securities of that series, waive any past default under30 days nor more than 60 days before the applicable Indenture with respect to that series, except a defaultredemption date. We will give the notice in the payment ofmanner described below in “—Notices.”
If a debt security represented by a global debt security is subject to repayment at the principal of,holder’s option, the depositary or premium, if any,its nominee, as the holder, will be the only person that can exercise the right to repayment. Any indirect owners who own beneficial interests in the global debt security and wish to exercise a repayment right must give proper and timely instructions to their banks or interestbrokers through which they hold their interests, requesting that they notify the depositary to exercise the repayment right on any Debt Security oftheir behalf. Different firms have different deadlines for accepting instructions from their customers, and you should take care to act promptly enough to ensure that seriesyour request is given effect by the depositary before the applicable deadline for exercise. Street name and other indirect owners should contact their banks or brokers for information about how to exercise a repayment right in a timely manner.
We or our affiliates may purchase debt securities from investors who are willing to sell from time to time, either in the open market at prevailing prices or in respect of a provision which under such applicable Indenture
cannotprivate transactions at negotiated prices. Debt securities that we or they purchase may, at our discretion, be modifiedheld, resold or amended without the consent of the Holder of each
Outstanding Debt Security of that series affected. (Section 513)
CONSOLIDATION, MERGERcancelled.
MERGERS AND SALE OF ASSETS
The Company, without the consent of any Holders of outstanding Debt
Securities, maySIMILAR TRANSACTIONS
We generally are permitted to merge or consolidate with or merge into, or transfer or lease itsanother entity. We also are permitted to sell our assets substantially as an entirety to another entity. With regard to any Person, andseries of debt securities, however, unless otherwise indicated in the applicable prospectus supplement, we may not take any other Personof these actions unless all the following conditions are met:
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| · | if the successor entity in the transaction is not Alexander’s, Inc., the successor entity must be a corporation, partnership or trust organized under the laws of the United States, any state in the United States or the District of Columbia and must expressly assume all of our obligations under the debt securities of that series and the indenture with respect to that series, |
| · | immediately after giving effect to the transaction, no default under the debt securities of that series has occurred and is continuing. For this purpose, “default under the debt securities of that series” means an event of default with respect to that series or any event that would be an event of default with respect to that series if the notice requirements and the required existence of the default for a specific period of time were disregarded. We describe these matters below under “—Default, Remedies and Waiver of Default,” |
| · | we or any successor entity, as the case may be, must take such steps as will be necessary to secure the debt securities of that series equally and ratably with or senior to all new indebtedness if, as a result of the transaction, our properties or assets would become subject to a mortgage, pledge, lien, security interest or other encumbrance which would not be permitted by the applicable indenture, and |
| · | we have delivered to the trustee an officers’ certificate and opinion of counsel, each stating that the transaction complies in all respects with the indenture. |
If the conditions described above are satisfied with respect to the debt securities of any series, we will not need to obtain the approval of the holders of those debt securities in order to merge or consolidate or to sell our assets. Also, these conditions will apply only if we wish to merge or consolidate with another entity or merge into, or transfer or lease itssell our assets substantially as an entirety to another entity. We will not need to satisfy these conditions if we enter into other types of transactions, including any transaction in which we acquire the Company, provided that (a) the Person (if other than the
Company) formed by such consolidationstock or into which the Company is merged or
which acquires or leases the assets of another entity, any transaction that involves a change of control of Alexander’s, Inc. but in which we do not merge or consolidate and any transaction in which we sell less than substantially all our assets.
SUBORDINATION PROVISIONS
Holders of subordinated debt securities should recognize that contractual provisions in the Company substantiallysubordinated debt indenture may prohibit us from making payments on those securities. Subordinated debt securities are subordinate and junior in right of payment, to the extent and in the manner stated in the subordinated debt indenture, to all of our senior debt, as an entirety
assumesdefined in the Company's obligations on the Debt Securitiessubordinated debt indenture, including all debt securities we have issued and will issue under the Indenture relating thereto and (b) after giving effect to such transaction no
Event of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have happened and be continuing.
(Article Eight) A Prospectus Supplement may set forth any additional provisions
regarding a consolidation with, merger into, or transfer or lease of its assets
substantiallysenior debt indenture.
The subordinated debt indenture defines “senior debt” as an entirety to, any Person (or of such Person with, into or to
the Company).
DEFEASANCE
If so indicated in the applicable Prospectus Supplement with respect
to the Debt Securities of a series, the Company, at its option (i) will be
discharged from any and all obligations in respect of the Debt Securities of
such series (except for certain obligations to register the transfer or
exchange of Debt Securities of such series, to replace destroyed, stolen, lost
or mutilated Debt Securities of such series, and to maintain an office or
agency in respect of the Debt Securities and hold moneys for payment in trust)
or (ii) will be released from its obligations to comply with any covenants that
may be specified in the applicable Prospectus Supplement with respect to the
Debt Securities of such series, and the occurrence of an event described in
clause (d) under "Events of Default" above with respect to any defeased
covenants shall no longer be an Event of Default, if in either case the Company
irrevocably deposits with the applicable Trustee, in trust, money or U.S.
Government Obligations that through the payment of interest thereon and
principal thereof in accordance with their terms will provide money in an
amount sufficient to pay all of the principal of and premium, if any, and any
interest on the Debt Securities of such series on the dates such payments are
due (which may include one or more redemption dates designated by the Company)
in accordance with the terms of such Debt Securities. Such a trust may only be
established if, among other things, (a) no Event of Default or event which with
the giving of notice or lapse of time, or both, would become an Event of
Default under the applicable Indenture shall have occurred and be continuing on
the date of such deposit, (b) no Event of Default described under clause (e)
under "Events of Default" above or event which with the giving of notice or
lapse of time, or both, would become an Event of Default described under such
clause (e) shall have occurred and be continuing at any time during the period
ending on the 91st day following such date of deposit, and (c) the Company
shall have delivered an Opinion of Counsel to the effect that the Holders of
the Debt Securities will not recognize gain or loss for United States federal
income tax purposes as a result of such deposit or defeasance and will be
subject to United States federal income tax in the same manner as if such
deposit and defeasance had not occurred, which Opinion of Counsel, in the case
of a deposit and defeasance of such Indenture with respect to the Debt
Securities of any series as described under clause (i) above, shall be based on
either (A) a ruling to such effect that the Company has received from, or that
has been published by, the Internal Revenue Service or (B) a change in the
applicable federal income tax law, occurring after the date of the applicable
Indenture, to such effect. In the event the Company omits to comply with its
remaining obligations under such Indenture after a defeasance of such Indenture
with respect to the Debt Securities of any series as described under clause
(ii) above and the Debt Securities of such series are declared due and payable
because of the occurrence of any undefeased Event of Default, the amount of
money and U.S. Government Obligations on deposit with the applicable Trustee
may be insufficient
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to pay amounts due on the Debt Securities of such series at the time of the
acceleration resulting from such Event of Default. However, the Company will
remain liable for such payments. (Article Thirteen)
SUBORDINATION OF SUBORDINATED DEBT SECURITIES
Unless otherwise indicated in the Prospectus Supplement, the following
provisions will apply to the Subordinated Debt Securities.
The Subordinated Debt Securities will, to the extent set forth in the
Subordinated Indenture, be subordinate in right of payment to the prior payment
in full of all Senior Debt, including the Senior Debt Securities. Upon any
payment or distribution of assets to creditors upon any liquidation,
dissolution, winding up, reorganization, assignment for the benefit of
creditors, marshalling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Company, the holders of Senior Debt will first be
entitled to receive payment in full of principal of (and premium, if any) and
interest, if any, on such Senior Debt before the holders of the Subordinated
Debt Securities will be entitled to receive or retain any payment in respect of
the principal of (and premium, if any) or interest, if any, on the Subordinated
Debt Securities. (Article Fifteen of the Subordinated Indenture)
By reason of such subordination, in the event of liquidation or
insolvency, creditors of the Company who are not holders of Senior Debt or
Subordinated Debt Securities may recover less, ratably, than holders of Senior
Debt and may recover more, ratably, than the holders of the Subordinated Debt
Securities.
In the event of the acceleration of the maturity of any Subordinated
Debt Securities, the holders of all Senior Debt outstanding at the time of such
acceleration will first be entitled to receive payment in full of all amounts
due thereon before the holders of the Subordinated Debt Securities will be
entitled to receive any payment upon the principal of (or premium, if any) or
interest, if any, on the Subordinated Debt Securities.
No payments on account of principal (or premium, if any) or interest,
if any, in respect of the Subordinated Debt Securities may be made if there
shall have occurred and be continuing a default in any payment with respect to
Senior Debt, or an event of default with respect to any Senior Debt resulting
in the acceleration of the maturity thereof, or if any judicial proceeding
shall be pending with respect to any such default. For purposes of the
subordination provisions, the payment, issuance and delivery of cash, property
or securities (other than stock and certain subordinated securities of the
Company) upon conversion of a Subordinated Debt Security will be deemed to
constitute payment on account of the principal of such Subordinated Debt
Security.
"Senior Debt" is defined to mean the principal of (and premium, if
any) and interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company to the
extent such claim for post-petition interest is allowed in such proceeding) on
allour indebtedness of the Company (including indebtedness of others guaranteed by
the Company), other than the Subordinated Debt Securitiessubordinated debt securities, whether outstanding on the date of the Subordinated Indentureindenture or thereafter created, incurred or assumed, which is: (i)is (a) for money borrowed, (ii)(b) evidenced by a note or similar instrument given in connection with the acquisition of any businesses, properties or assets of any kind or (iii)(c) obligations of the CompanyAlexander’s, Inc. as lessee under leases required to be capitalized on the balance sheet of the lessee under accounting principles generally accepted accounting principlesin the United States of America or leases of property or assets made as part of any sale and lease-back transaction to which we are a party. For the Companypurpose of this definition, “interest” includes interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to Alexander’s to the extent that the claim for post-petition interest is a
party, includingallowed in the proceeding. Also for the purpose of this definition, “indebtedness of Alexander’s, Inc.” includes indebtedness of others guaranteed by us and amendments, renewals, extensions, modifications and refundings of any such indebtedness or obligation unlessof the kinds described in the first sentence of this paragraph. However, “indebtedness of Alexander’s, Inc.” for the purpose of this definition, does not include any case inindebtedness or obligation if the instrument creating or evidencing any suchthe indebtedness or obligation, or pursuant tounder which the sameindebtedness or obligation is outstanding, it is providedprovides that suchthe indebtedness or obligation is not superior in right of payment to the Subordinated Debt Securities.
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subordinated debt securities.
The Subordinated Indenture does not limitsubordinated debt indenture provides that, unless all principal of and any premium or prohibitinterest on the incurrencesenior debt has been paid in full, no payment or other distribution may be made in respect of additional Senior Debt, which may include indebtednessany subordinated debt securities in the following circumstances:
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| · | in the event of any insolvency or bankruptcy proceedings, or any receivership, liquidation, reorganization or other similar proceeding involving us or our assets, |
| · | in the event of any liquidation, dissolution or other winding-up of our affairs, whether voluntary or involuntary, and whether or not involving insolvency or bankruptcy, |
| · | in the event of any assignment for the benefit of creditors or any other marshalling of our assets and liabilities, |
| · | if any of our subordinated debt securities have been declared due and payable before their stated maturity, or |
| · | (a) in the event and during the continuation of any default in the payment of principal, premium or interest on any senior debt beyond any applicable grace period or if any event of default with respect to any of our senior debt has occurred and is continuing, permitting the holders of that senior debt or a trustee to accelerate the maturity of that senior debt, unless the event of default has been cured or waived or ceased to exist and any related acceleration has been rescinded, or (b) if any judicial proceeding is pending with respect to a payment default or an event of default described in (a). |
If the trustee under the subordinated debt indenture or any holders of the subordinated debt securities receive any payment or distribution that they know is seniorprohibited under the subordination provisions, then the trustee or the holders will have to repay that money to the Subordinated Debt Securities,holders of the senior debt.
Even if the subordination provisions prevent us from making any payment when due on the subordinated debt securities of any series, we will be in default on our obligations under that series if we do not make the payment when due. This means that the trustee under the subordinated debt indenture and the holders of that series can take action against us, but subordinatethey will not receive any money until the claims of the holders of senior debt have been fully satisfied.
COVENANTS
The following covenants apply to us with respect to the debt securities of each series unless otherwise specified in the applicable prospectus supplement.
Maintenance of Properties. We must maintain all properties used in our business in good condition. However, we may discontinue the maintenance or operation of any of our properties if in our judgment, discontinuance is desirable in the conduct of our business and is not disadvantageous in any material respect to the holders of debt securities.
Existence. Except as described under “—Mergers and Similar Transactions,” we must do or cause to be done all things necessary to preserve and keep in full force and effect our existence, rights and franchises. However, we are not required to preserve any right or franchise if our board of directors determines that the preservation of the right or franchise is no longer desirable in the conduct of our business and that the loss of the right or franchise is not disadvantageous in any material respect to the holders of the debt securities.
Payment of Taxes and Other Claims. We are required to pay or discharge or cause to be paid or discharged (a) all taxes, assessments and governmental charges levied or imposed upon us or any subsidiary or upon our income, profits or property or the income, profits or property of any subsidiary and (b) all lawful claims for labor, materials and supplies which, if unpaid, might by law become a lien upon our property or the property of any subsidiary. We must pay these taxes and other claims before they become delinquent. However, we are not required to pay or discharge or cause to be paid or discharged any tax, assessment, and charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings.
DEFEASANCE AND COVENANT DEFEASANCE
The provisions for full defeasance and covenant defeasance described below apply to each senior and subordinated debt security if so indicated in the applicable prospectus supplement. In general, we expect these
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provisions to apply to each debt security that has a specified currency of U.S. dollars and is not a floating rate or indexed debt security.
Full Defeasance. If there is a change in Federal income tax law, as described below, we can legally release ourselves from all payment and other obligations on any debt securities. This is called full defeasance. For us to do so, each of the Company.following must occur:
| · | we must deposit in trust for the benefit of all holders of those debt securities money in an amount or a combination of money and U.S. government or U.S. government agency notes or bonds that will generate enough cash to make interest, principal and any other payments on those debt securities on their various due dates, |
| · | (a) no event of default under the indenture may have occurred and be continuing and (b) no event of default described in the sixth bullet point under “—Default, Remedies and Waiver of Default—Events of Default” may have occurred and be continuing at any time during the 90 days following the deposit in trust, |
| · | there must be a change in current Federal income tax law or an IRS ruling that lets us make the above deposit without causing the holders to be taxed on those debt securities any differently than if we did not make the deposit and just repaid those debt securities ourselves. Under current Federal income tax law, the deposit and our legal release from your debt security would be treated as though we took back your debt security and gave you your share of the cash and notes or bonds deposited in trust. In that event, you could recognize gain or loss on your debt security, and |
| · | we must deliver to the trustee a legal opinion of our counsel confirming the Federal income tax law change described above. |
If we ever fully defeased your debt security, you would have to rely solely on the trust deposit for payments on your debt security. You would not be able to look to us for payment if there was any shortfall.
Covenant Defeasance. Under current Federal income tax law, we can make the same type of deposit described above and be released from the restrictive covenants relating to your debt security listed in the bullets below and any additional restrictive covenants that may be described in your prospectus supplement. This is called covenant defeasance. In that event, you would lose the protection of those restrictive covenants. In order to achieve covenant defeasance for any debt securities, we must take the same steps as are required for defeasance.
If we accomplish covenant defeasance with regard to your debt security, the following provisions of the applicable indenture and your debt security would no longer apply:
| · | the requirement to secure the debt securities equally and ratably with all new indebtedness in the event of a consolidation, |
| · | the covenants regarding existence, maintenance of properties, payment of taxes and other claims, |
| · | any additional covenants that your prospectus supplement states are applicable to your debt security, and |
| · | the events of default resulting from a breach of covenants, described below in the fourth, fifth and seventh bullet points under “—Default, Remedies and Waiver of Default—Events of Default.” |
If we accomplish covenant defeasance on your debt security, we must still repay your debt security if there is any shortfall in the trust deposit. You should note, however, that if one of the remaining events of default occurred, such as our bankruptcy, and your debt security became immediately due and payable, there may be a shortfall. Depending on the event causing the default, you may not be able to obtain payment of the shortfall.
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DEFAULT, REMEDIES AND WAIVER OF DEFAULT
You will have special rights if an event of default, with respect to your series of debt securities, occurs and is continuing, as described in this subsection.
Events of Default. Unless your prospectus supplement says otherwise, when we refer to an event of default with respect to any series of debt securities, we mean any of the following:
| · | we do not pay interest on any debt security of that series within 30 days after the due date, |
| · | we do not pay the principal or any premium of any debt security of that series on the due date, |
| · | we do not deposit a sinking fund payment with regard to any debt security of that series on the due date, but only if the payment is required under the applicable prospectus supplement, |
| · | we remain in breach of any covenant we make in the indenture for the benefit of the relevant series for 60 days after we receive a written notice of default stating that we are in breach and requiring us to remedy the breach. The notice must be sent by the trustee or the holders of at least 10% in principal amount of the relevant series of debt securities, |
| · | we do not pay an indebtedness of $50,000,000 or more in principal amount outstanding when due after the expiration of any applicable grace period, or we default on an indebtedness of this amount resulting in acceleration of the indebtedness, in either case, within ten days after written notice of the default is sent to us. The notice must be sent by the trustee or the holders of at least 10% in principal amount of the relevant series of debt securities, |
| · | we file for bankruptcy, or |
| · | if your prospectus supplement states that any additional event of default applies to the series, that event of default occurs. |
REMEDIES IF AN EVENT OF DEFAULT OCCURS
If you are the holder of a subordinated debt security, all the remedies available upon the occurrence of an event of default under the subordinated debt indenture will be subject to the restrictions on the subordinated debt securities described above under “—Subordination Provisions.”
If an event of default has occurred with respect to any series of debt securities and has not been cured or waived, the trustee or the holders of not less than 25% in principal amount of outstanding debt securities of that series may declare the entire principal amount of the debt securities of that series to be due immediately.
Each of the situations described above is called an acceleration of the maturity of the affected series of debt securities. If the maturity of any series is accelerated, a judgment for payment has not yet been obtained, we pay or deposit with the trustee an amount sufficient to pay all amounts due on the securities of the series, and all events of default with respect to the series, other than the nonpayment of the accelerated principal, have been cured or waived, then the holders of a majority in principal amount of the outstanding debt securities of that series may cancel the acceleration for the entire series.
If an event of default occurs, the trustee will have special duties. In that situation, the trustee will be obligated to use those of its rights and powers under the relevant indenture, and to use the same degree of care and skill in doing so, that a prudent person would use in that situation in conducting his or her own affairs.
Except as described in the prior paragraph, the trustee is not required to take any action under the relevant indenture at the request of any holders unless the holders offer the trustee reasonable protection from expenses and liability. This is called an indemnity. If the trustee is provided with an indemnity reasonably satisfactory to it, the holders of a majority in principal amount of all debt securities of the relevant series may direct the time, method and place of conducting any lawsuit or other formal legal action seeking any remedy available to the trustee with respect
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to that series. These majority holders may also direct the trustee in performing any other action under the applicable indenture with respect to the debt securities of that series.
Before you bypass the trustee and bring your own lawsuit or other formal legal action or take other steps to enforce your rights or protect your interests relating to any debt security, all of the following must occur:
| · | the holder of your debt security must give the trustee written notice of a continuing event of default, |
| · | the holders of not less than 25% in principal amount of all debt securities of your series must make a written request that the trustee take action because of the default, and they or other holders must offer to the trustee indemnity reasonably satisfactory to the trustee against the cost and other liabilities of taking that action, |
| · | the trustee must not have taken action for 60 days after the above steps have been taken, and |
| · | during those 60 days, the holders of a majority in principal amount of the debt securities of your series must not have given the trustee directions that are inconsistent with the written request of the holders of not less than 25% in principal amount of the debt securities of your series. |
You are entitled at any time, however, to bring a lawsuit for the payment of money due on your debt security on or after its due date.
Waiver of Default. The Senior Debt Securities, when issued,holders of not less than a majority in principal amount of the outstanding debt securities of a series may waive a default for all debt securities of that series. If this happens, the default will constitute Senior Debt.
The Prospectus Supplementbe treated as if it has not occurred. No one can waive a payment default on your debt security or a covenant or provision of the indenture that cannot be modified or amended without the consent of the holder of each outstanding debt security of the series, however, without the approval of the particular holder of that debt security.
Book-entry and other indirect owners should consult their banks or brokers for information on how to give notice or direction to, or make a request of, the trustee and how to declare or cancel an acceleration of the maturity. Book-entry and other indirect owners are described below under “Legal Ownership and Book-Entry Issuance.”
CHANGES OF THE INDENTURES REQUIRING EACH HOLDER’S APPROVAL
There are certain changes that cannot be made without the approval of each holder of a debt security affected by the change under a particular indenture. Here is a list of those types of changes:
| · | changes to the stated maturity for any principal or interest payment on a debt security, |
| · | reduction of the principal amount or the interest rate or the premium payable upon the redemption of any debt security, |
| · | reduction of the amount of principal of an original issue discount security or any other debt security payable upon acceleration of its maturity, |
| · | changes to the currency of any payment on a debt security, |
| · | changes to the place of payment on a debt security, |
| · | impairment of a holder’s right to sue for payment of any amount due on its debt security, |
| · | reduction of the percentage in principal amount of the debt securities of any series, the approval of whose holders is needed to change the applicable indenture or those debt securities, |
| · | reduction of the percentage in principal amount of the debt securities of any series, the consent of whose holders is needed to waive our compliance with the applicable indenture or to waive defaults, and |
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| · | changes to the provisions of the applicable indenture dealing with modification and waiver in any other respect, except to increase any required percentage referred to above or to add to the provisions that cannot be changed or waived without approval of the holder of each affected debt security. |
MODIFICATION OF SUBORDINATION PROVISIONS
We may further describenot amend the provisions, if any,
applicablesubordinated debt indenture to alter the subordination of any outstanding subordinated debt securities without the Subordinatedwritten consent of each holder of senior debt then outstanding who would be adversely affected. In addition, we may not modify the subordination provisions of the subordinated debt indenture in a manner that would adversely affect the outstanding subordinated debt securities of any one or more series in any material respect, without the consent of the holders of a majority in aggregate principal amount of all affected series, voting together as one class.
CHANGES OF THE INDENTURES NOT REQUIRING APPROVAL
Another type of change does not require any approval by holders of the debt securities of an affected series. These changes are limited to clarifications and changes that would not adversely affect the debt securities of that series in any material respect. Nor do we need any approval to make changes that affect only debt securities to be issued under the applicable indenture after the changes take effect.
We also may make changes or obtain waivers that do not adversely affect a particular debt security, even if they affect other debt securities. In those cases, we do not need to obtain the approval of the holder of the unaffected debt security, we need only obtain any required approvals from the holders of the affected debt securities.
CHANGES OF THE INDENTURES REQUIRING MAJORITY APPROVAL
Any other change to a particular indenture and the debt securities issued under that indenture would require the following approval:
| · | if the change affects only the debt securities of a particular series, it must be approved by the holders of a majority in principal amount of the debt securities of that series, or |
| · | if the change affects the debt securities of more than one series of debt securities issued under the applicable indenture, it must be approved by the holders of a majority in principal amount of each series affected by the change. |
In each case, the required approval must be given by written consent.
The same majority approval would be required for us to obtain a waiver of any of our covenants in either indenture. Our covenants include the promises we make about merging and similar transactions, which we describe above under “—Mergers and Similar Transactions.” If the requisite holders approve a waiver of a covenant, we will not have to comply with it. The holders, however, cannot approve a waiver of any provision in a particular debt security, or in the applicable indenture as it affects that debt security, that we cannot change without the approval of the holder of that debt security as described above in “—Changes of the Indentures Requiring Each Holder’s Approval,” unless that holder approves the waiver.
Book-entry and other indirect owners should consult their banks or brokers for information on how approval may be granted or denied if we seek to change an indenture or any debt securities or request a waiver.
SPECIAL RULES FOR ACTION BY HOLDERS
When holders take any action under either debt indenture, such as giving a notice of default, declaring an acceleration, approving any change or waiver or giving the trustee an instruction, we will apply the following rules:
ONLY OUTSTANDING DEBT SECURITIES ARE ELIGIBLE
Only holders of outstanding debt securities of the applicable series will be eligible to participate in any action by holders of debt securities of that series. Also, we will count only outstanding debt securities in
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determining whether the various percentage requirements for taking action have been met. For these purposes, a debt security will not be “outstanding”:
| · | if it has been surrendered for cancellation or cancelled, |
| · | if we have deposited or set aside, in trust for its holder, money for its payment or redemption, |
| · | if we have fully defeased it as described above under “—Defeasance and Covenant Defeasance—Full Defeasance,” |
| · | if it has been exchanged for other debt securities of the same series due to mutilation, destruction, loss or theft, or |
| · | if we or one of our affiliates is the owner, unless the debt security is pledged under certain circumstances described in the indenture. |
ELIGIBLE PRINCIPAL AMOUNT OF SOME DEBT SECURITIES
In some situations, we may follow special rules in calculating the principal amount of a debt security that is to be treated as outstanding for the purposes described above. This may happen, for example, if the principal amount is payable in a non-U.S. dollar currency, increases over time or is not to be fixed until maturity.
For any debt security of the kind described below, we will decide how much principal amount to attribute to the debt security as follows:
| · | for an original issue discount debt security, we will use the principal amount that would be due and payable on the action date if the maturity of the debt security were accelerated to that date because of a default, |
| · | for a debt security whose principal amount is not determinable, we will use any amount that we indicate in the applicable prospectus supplement for that debt security. The principal amount of a debt security may not be determinable, for example, because it is based on an index that changes from time to time and the principal amount is not to be determined until a later date, or |
| · | for debt securities with a principal amount denominated in one or more non-U.S. dollar currencies or currency units, we will use the U.S. dollar equivalent, which we will determine. |
DETERMINING RECORD DATES FOR ACTION BY HOLDERS
We generally will be entitled to set any day as a record date for the purpose of determining the holders that are entitled to take action under either indenture. In certain limited circumstances, only the trustee will be entitled to set a record date for action by holders. If we or the trustee set a record date for an approval or other action to be taken by holders, that vote or action may be taken only by persons or entities who are holders on the record date and must be taken during the period that we specify for this purpose, or that the trustee specifies if it sets the record date. We or the trustee, as applicable, may shorten or lengthen this period from time to time. This period, however, may not extend beyond the 180th day after the record date for the action. In addition, record dates for any global debt security may be set in accordance with procedures established by the depositary from time to time. Accordingly, record dates for global debt securities may differ from those for other debt securities.
FORM, EXCHANGE AND TRANSFER OF DEBT SECURITIES
Unless we indicate otherwise in your prospectus supplement, the debt securities will be issued:
| · | only in fully registered form, and |
| · | in denominations of $1,000 and integral multiples of $1,000. |
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Holders may exchange their debt securities for debt securities of the same series in any authorized denominations, as long as the total principal amount is not changed.
Holders may exchange or transfer their debt securities at the corporate trust office of the trustee. They may also replace lost, stolen, destroyed or mutilated debt securities at that office. We have appointed the trustee to act as our agent for registering debt securities in the names of holders and transferring and replacing debt securities.
Holders will not be required to pay a service charge to transfer or exchange their debt securities, but they may be required to pay for any tax or other governmental charge associated with the registration, exchange or transfer. The transfer or exchange, and any replacement, will be made only if our transfer agent is satisfied with the holder’s proof of legal ownership. The transfer agent may require an indemnity before replacing any debt securities.
If a debt security is issued as a global debt security, only the depositary, e.g., DTC, Euroclear and Clearstream, will be entitled to transfer and exchange the debt security as described in this subsection, since the depositary will be the sole holder of the debt security.
The rules for exchange described above apply to exchange of debt securities for other debt securities of the same series and kind.
PAYMENT MECHANICS FOR DEBT SECURITIES
Who Receives Payment?
If interest is due on a debt security on an interest payment date, we will pay the interest to the person in whose name the debt security is registered at the close of business on that regular record date as described below under “—Payment and Record Dates for Interest.” If interest is due at maturity but on a day that is not an interest payment date, we will pay the interest to the person entitled to receive the principal of the debt security. If principal or another amount besides interest is due on a debt security at maturity, we will pay the amount to the holder of the debt security against surrender of the debt security at a proper place of payment or, in the case of a global debt security, in accordance with the applicable policies of the depositary, e.g., DTC, Euroclear and Clearstream, as applicable.
Payment and Record Dates for Interest
The regular record date relating to an interest payment date for any floating rate debt security will be the 15th calendar day before that interest payment date. These record dates will apply regardless of whether a particular record date is a “business day,” as defined below. For the purpose of determining the holder at the close of business on a regular record date when business is not being conducted, the close of business will mean 5:00 P.M., New York City time, on that day.
Business Day. The term “business day” means, with respect to the debt securities of a series, a Monday, Tuesday, Wednesday, Thursday or Friday that is not a day on which banking institutions in the place of payment for the debt securities of that series are authorized or obligated by law or executive order to close and that satisfies any other criteria specified in the applicable prospectus supplement.
How We Will Make Payments Due in U.S. Dollars
We will follow the practice described in this subsection when paying amounts due in U.S. dollars. Payments of amounts due in other currencies will be made as described in the next subsection.
Payments on Global Debt Securities. We will make payments on a global debt security in accordance with the applicable policies of a
particular series.
GOVERNING LAW
The Indenturesthe depositary as in effect from time to time. Under those policies, we will make payments directly to the depositary, or its nominee, and not to any indirect owners who own beneficial interests in the Debt Securitiesglobal debt security. An indirect owner’s right to receive those payments will be governed by the rules and construedpractices of the depositary and its participants, as described below in the section entitled “Legal Ownership and Book-Entry Issuance—What Is a Global Security?”
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Payments on Non-Global Debt Securities. We will make payments on a debt security in non-global, registered form as follows. We will pay interest that is due on an interest payment date by check mailed on the interest payment date to the holder at his or her address shown on the trustee’s records as of the close of business on the regular record date. We will make all other payments by check to the paying agent described below, against surrender of the debt security. All payments by check will be made in next-day funds, i.e., funds that become available on the day after the check is cashed.
Alternatively, if a non-global debt security has a face amount of at least $1,000,000 and the holder asks us to do so, we will pay any amount that becomes due on the debt security by wire transfer of immediately available funds to an account at a bank in New York City, on the due date. To request a wire payment, the holder must give the paying agent appropriate wire transfer instructions at least five business days before the requested wire payment is due. In the case of any interest payment due on an interest payment date, the instructions must be given by the person or entity who is the holder on the relevant regular record date. In the case of any other payment, payment will be made only after the debt security is surrendered to the paying agent. Any wire instructions, once properly given, will remain in effect unless and until new instructions are given in the manner described above.
Book-entry and other indirect owners should consult their banks or brokers for information on how they will receive payments on their debt securities.
How We Will Make Payments Due in Other Currencies
We will follow the practice described in this subsection when paying amounts that are due in a specified currency other than U.S. dollars.
Payments on Global Debt Securities. We will make payments on a global debt security in accordance with the lawsapplicable policies of the Statedepositary as in effect from time to time, which will be DTC, Euroclear or Clearstream. Unless we specify otherwise in the applicable prospectus supplement, DTC will be the depositary for all debt securities in global form. We understand that DTC’s policies, as currently in effect, are as follows.
Unless otherwise indicated in your prospectus supplement, if you are an indirect owner of global debt securities denominated in a specified currency other than U.S. dollars and if you have the right to elect to receive payments in that other currency and do so elect, you must notify the participant through which your interest in the global debt security is held of your election:
| · | on or before the applicable regular record date, in the case of a payment of interest, or |
| · | on or before the 16th day before the stated maturity, or any redemption or repayment date, in the case of payment of principal or any premium. |
Your participant must, in turn, notify DTC of your election on or before the third DTC business day after that regular record date, in the case of a payment of interest, and on or before the 12th DTC business day prior to the stated maturity, or on the redemption or repayment date if your debt security is redeemed or repaid earlier, in the case of a payment of principal or any premium.
DTC, in turn, will notify the paying agent of your election in accordance with DTC’s procedures.
If complete instructions are received by the participant and forwarded by the participant to DTC, and by DTC to the paying agent, on or before the dates noted above, the paying agent, in accordance with DTC’s instructions, will make the payments to you or your participant by wire transfer of immediately available funds to an account maintained by the payee with a bank located in the country issuing the specified currency or in another jurisdiction acceptable to us and the paying agent.
If the foregoing steps are not properly completed, we expect DTC to inform the paying agent that payment is to be made in U.S. dollars. In that case, we or our agent will convert the payment to U.S. dollars in the manner described below under “—Conversion to U.S. Dollars.” We expect that we or our agent will then make the payment in U.S. dollars to DTC, and that DTC in turn will pass it along to its participants.
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Indirect owners of a global debt security denominated in a currency other than U.S. dollars should consult their banks or brokers for information on how to request payment in the specified currency.
Payments on Non-Global Debt Securities. Except as described in the last paragraph under this heading, we will make payments on debt securities in non-global form in the applicable specified currency. We will make these payments by wire transfer of immediately available funds to any account that is maintained in the applicable specified currency at a bank designated by the holder and which is acceptable to us and the trustee. To designate an account for wire payment, the holder must give the paying agent appropriate wire instructions at least five business days before the requested wire payment is due. In the case of any interest payment due on an interest payment date, the instructions must be given by the person or entity who is the holder on the regular record date. In the case of any other payment, the payment will be made only after the debt security is surrendered to the paying agent. Any instructions, once properly given, will remain in effect unless and until new instructions are properly given in the manner described above.
If a holder fails to give instructions as described above, we will notify the holder at the address in the trustee’s records and will make the payment within five business days after the holder provides appropriate instructions. Any late payment made in these circumstances will be treated under the applicable indenture as if made on the due date, and no interest will accrue on the late payment from the due date to the date paid.
Although a payment on a debt security in non-global form may be due in a specified currency other than U.S. dollars, we will make the payment in U.S. dollars if the holder asks us to do so. To request U.S. dollar payment, the holder must provide appropriate written notice to the trustee at least five business days before the next due date for which payment in U.S. dollars is requested. In the case of any interest payment due on an interest payment date, the request must be made by the person or entity who is the holder on the regular record date. Any request, once properly made, will remain in effect unless and until revoked by notice properly given in the manner described above.
Book-entry and other indirect owners of a debt security with a specified currency other than U.S. dollars should contact their banks or brokers for information about how to receive payments in the specified currency or in U.S. dollars.
Conversion to U.S. Dollars. When we are asked by a holder to make payments in U.S. dollars of an amount due in another currency, either on a global debt security or a non-global debt security as described above, the exchange rate agent described below will calculate the U.S. dollar amount the holder receives in the exchange rate agent’s discretion.
A holder that requests payment in U.S. dollars will bear all associated currency exchange costs, which will be deducted from the payment.
When the Specified Currency Is Not Available. If we are obligated to make any payment in a specified currency other than U.S. dollars, and the specified currency or any successor currency is not available to us due to circumstances beyond our control, such as the imposition of exchange controls or a disruption in the currency markets, we will be entitled to satisfy our obligation to make the payment in that specified currency by making the payment in U.S. dollars, on the basis of the exchange rate determined by the exchange rate agent described below, in its discretion.
The foregoing will apply to any debt security, whether in global or non-global form, and to any payment, including a payment at maturity. Any payment made under the circumstances and in a manner described above will not result in a default under any debt security or the applicable indenture.
The Euro. The Euro may be a specified currency for some debt securities. On January 1, 1999, the Euro became the legal currency for the 11 member states participating in the European Economic and Monetary Union.
Exchange Rate Agent. If we issue a debt security in a specified currency other than U.S. dollars, we will appoint a financial institution to act as the exchange rate agent and will name the institution initially appointed when the debt security is originally issued in the applicable prospectus supplement. We may change the exchange rate agent from time to time after the original issue date of the debt security without your consent and without notifying
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you of the change. All determinations made by the exchange rate agent will be in its sole discretion unless we state in the applicable prospectus supplement that any determination requires our approval. In the absence of manifest error, those determinations will be conclusive for all purposes and binding on you and us, without any liability on the part of the exchange rate agent.
Payment When Offices Are Closed
If any payment is due on a debt security on a day that is not a business day, we will make the payment on the next day that is a business day. Payments postponed to the next business day in this situation will be treated under the applicable indenture as if they were made on the original due date. Postponement of this kind will not result in a default under any debt security or the applicable indenture, and no interest will accrue on the postponed amount from the original due date to the next day that is a business day. The term business day has a special meaning, which we describe above under “—Payment and Record Dates for Interest.”
Paying Agent
We may appoint one or more financial institutions to act as our paying agents, at whose designated offices debt securities in non-global entry form may be surrendered for payment at their maturity. We call each of those offices a paying agent. We may add, replace or terminate paying agents from time to time.
We also may choose to act as our own paying agent. Initially, we have appointed the trustee, at its corporate trust office in New York City, as the paying agent. We must notify the trustee of changes in the paying agents.
NOTICES
Notices to be given to holders of a global debt security will be given only to the depositary, in accordance with its applicable policies as in effect from time to time. Notices to be given to holders of debt securities not in global form will be sent by mail to the respective addresses of the holders as they appear in the trustee’s records. Neither the failure to give any notice to a particular holder, nor any defect in a notice given to a particular holder, will affect the sufficiency of any notice given to another holder.
Book-entry and other indirect owners should consult their banks or brokers for information on how they will receive notices.
OUR RELATIONSHIP WITH THE TRUSTEE
The Bank of New York. (Section 112)
REGARDING THE TRUSTEES
The CompanyYork Mellon has provided commercial banking and certain of its subsidiariesother services for us and our affiliates in the ordinary coursepast and may do so in the future.
The Bank of business maintain general banking relationsNew York Mellon is initially serving as the trustee for our senior debt securities and subordinated debt securities. Consequently, if an actual or potential event of default occurs with State Street Bank & Trust
Company, N.A. Pursuantrespect to any of these securities, the provisionstrustee may be considered to have a conflicting interest for purposes of the Trust Indenture Act of 1939,
upon a default under either1939. In that case, the Senior Indenture or the Subordinated Indenture,
State Street Bank & Trust Company, N.A.trustee may be deemed to have a conflicting
interest by virtue of its acting as both the Senior Trustee and the
Subordinated Trustee requiring itrequired to resign under one or more of the indentures, and we would be replaced byrequired to appoint a successor trustee in onetrustee. For this purpose, a “potential” event of such positions.
default means an event that would be an event of default if the requirements for giving us default notice or for the default having to exist for a specific period of time were disregarded.
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DESCRIPTION OF CAPITAL STOCK
The following descriptions are summaries of the material terms and provisions of our preferred stock and our common stock contained in our certificate of incorporation and our by-laws. Copies of our certificate of incorporation and the descriptions contained in "--
Description of Preferred Stock" and "-- Description of Common Stock" do not
purport to be complete andby-laws are subject to, and qualified in their entirety by
referenceexhibits to the more complete descriptions thereof set forth in the following
documents: (i) the Company's Amended and Restated Certificate of Incorporation
(the "Certificate of Incorporation"), which is filed as an exhibit to the
Registration Statementregistration statement of which this Prospectus is a part and (ii) its By-laws,
which is incorporated by reference to the Registration Statement of which this
Prospectusprospectus is a part. For the CompanySee “Available Information” for information on how to qualify as a REIT under the Code, not more than 50%obtain copies of the valueour certificate of the outstanding stock may be owned, directly or indirectly, by
five or fewer individuals (as defined in the Code to include certain entities)
during the last halfincorporation and by-laws.
The certificate of a taxable year and the stock must be beneficially owned
by 100 or more persons during at least 335 days of a taxable year of 12 months
(or during a proportionate part of a shorter taxable year). Accordingly, the
Certificate of Incorporation contains provisions that restrict the ownership
and transfer of shares of capital stock. The Certificate of Incorporation also
contains provisions that restrict the ownership and transfer of shares of
capital stock to reduce the risk that the Company's ability to use its NOLs
would be limited.
The Certificate of Incorporationincorporation authorizes the issuance of up to 26,000,000 shares of capital stock, consisting of 10,000,000 shares of Common
Stock,common stock, $1.00 par value per share (the "Common Stock"“common stock”), 3,000,000 shares of preferred stock, $1.00 par value per share (the "Preferred Stock"“preferred stock”), and 13,000,000 shares of excess stock, $1.00 par value per share (the "Excess
Stock"“excess stock”). As of August 4, 1995, 5,000,850November 24, 2008, 5,173,450 and 5,081,590 shares of Common Stockcommon stock were issued and outstanding.outstanding, respectively. No shares of Preferred Stockpreferred stock or shares of Excess Stockexcess stock are issued and outstanding.
outstanding as of the date of this prospectus.
DESCRIPTION OF PREFERRED STOCK
The following is a description of certain general terms and provisions
of the Preferred Stock. The particularmaterial terms of any series of Preferred Stock
will be described in the applicable Prospectus Supplement. If so indicated inour preferred stock is only a Prospectus Supplement, the terms of any such series may differ from the terms
set forth below.
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The summary of terms of the Company's Preferred Stock contained in
this Prospectus does not purport to be complete and is subject to, and qualified in its entirety by reference to the provisions of the Certificateour certificate of Incorporationincorporation and the certificate of designations relating to each series of the Preferred Stockpreferred stock (the "Certificate“certificate of Designation"designations”), which will be filed as an exhibit to or incorporated by reference in the Registration Statementregistration statement of which this Prospectusprospectus is a part, at or prior to the time of issuance of such series of the Preferred Stock.preferred stock. The Certificateparticular terms of Incorporation authorizesany series of preferred stock will be described in the issuance of 3,000,000
shares of Preferred Stock. No shares of Preferred Stock are outstanding as ofapplicable prospectus supplement, which will supplement the date of this Prospectus. information below.
General
The Preferred Stockpreferred stock authorized by the Certificateour certificate of Incorporationincorporation may be issued from time to time in one or more series in suchthe amounts and with suchthe designations, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications and terms and conditions of redemption as may be fixed by our board of directors. The preferred stock, upon issuance against full payment of the Boardapplicable purchase price, will be fully paid and nonassessable. The liquidation preference is not indicative of Directors.the price at which the shares of preferred stock will actually trade on or after the date of issuance. Under certain circumstances, the issuance of Preferred Stockpreferred stock could have the effect of delaying, deferring or preventing a change of control of the Companyour company and may adversely affect the voting and other rights of the Holdersholders of Common
Stock. See "Risk Factors--Anti-takeover Effectscommon stock. The certificate of Provisionsincorporation authorizes our board of the
Certificate of Incorporation and By-laws." The Certificate of Incorporation
authorizes the Board of Directorsdirectors to classify or reclassify, in one or more series, any unissued shares of preferred stock and to reclassify any unissued shares of Preferred Stockany series of preferred stock by setting or changing the designations, preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions, qualifications and terms and conditions of redemption of such
Preferred Stock.
the preferred stock.
The Preferred Stockpreferred stock shall have the dividend, liquidation, redemption and voting rights set forthdescribed below, unless otherwise described in a Prospectus
Supplementas supplemented by the applicable prospectus supplement relating to aeach particular series of the Preferred Stock.preferred stock. The applicable Prospectus Supplementprospectus supplement will describe the following terms of the series of Preferred Stock in respect of which this Prospectus is being
delivered: (1) the title of such Preferred Stock and the number of shares
offered; (2) the amount of liquidation preference per share; (3) the initial
public offering price at which shares of such Preferred Stock will be issued;
(4) the dividend rate (or method of calculation), the dates on which dividends
shall be payable and the dates from which dividends shall commence to cumulate,
if any; (5) any redemption or sinking fund provisions; (6) any conversion or
exchange rights; (7) any additional voting, dividend, liquidation, redemption,
sinking fund and other rights, preferences, privileges, limitations and
restrictions; (8) any listing of such Preferred Stock on any securities
exchange; (9)preferred stock:
| · | the title of the preferred stock and the number of shares offered, |
| · | the amount of liquidation preference per share, |
| · | the initial public offering price at which the shares of preferred stock will be issued, |
| · | the dividend rate or method of calculation, the dates on which dividends will be payable and the dates from which dividends will commence to accumulate, if any, |
| · | any redemption or sinking fund provisions, |
| · | any conversion or exchange rights, |
| · | any additional voting, dividend, liquidation, redemption, sinking fund and other rights, preferences, limitations and restrictions, |
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| · | any listing of the preferred stock on any securities exchange, |
| · | the relative ranking and preferences of such preferred stock as to dividend rights and rights upon our liquidation, dissolution or winding-up of our affairs, |
| · | any limitations on issuance of any series of preferred stock ranking senior to or equally with the series of preferred stock as to dividend rights and rights upon our liquidation, dissolution or winding-up, |
| · | any limitations on direct or beneficial ownership and restrictions on transfer as may be appropriate to preserve our status as a REIT or to preserve our net operating loss carryovers, if any, and |
| · | any other specific terms, preferences or rights of, or limitations or restrictions on, the preferred stock. |
The applicable prospectus supplement also may include a discussion of federalFederal income tax considerations applicable to such Preferred Stock; (10) the relative ranking and preferences of such
Preferred Stock as to dividend rights and rights upon liquidation, dissolution
or winding up of the affairs of the Company; (11) any limitations on issuance
of any series of Preferred Stock ranking senior to or on a parity with such
series of Preferred Stock as to dividend rights and rights upon liquidation,
dissolution or winding up of the affairs of the Company; (12) any limitations
on direct or beneficial ownership and restrictions on transfer, in each case as
may be appropriate to preserve the status of the Company as a REIT; and (13)
any other specific terms, preferences or rights of, or limitations or
restrictions on, such Preferred Stock.
General
The shares of Preferred Stock offered hereby will be issued in one or
more series. Shares of Preferred Stock, upon issuance against full payment of
the purchase price therefor, will be fully paid and nonassessable. The
liquidation preference is not indicative of the price at which the shares of
Preferred Stock will actually trade on or after the date of issuance.
Rank
The Preferred Stock shall, withpreferred stock.
Ranking
With respect to dividend rights and rights upon liquidation, dissolution and winding up ofwinding-up, the Company,preferred stock will rank priorsenior to the
Common Stockour common stock and Excess Stock (otherexcess stock, other than certain Excess Stockexcess stock resulting from the conversion of Preferred Stock)preferred stock and to all other classes and series of our equity securities of the Company now or hereafterlater authorized, issued or outstanding, (the Common Stockother than any classes or series of our equity securities which by their terms specifically rank equal or senior to the preferred stock as to dividend rights and suchrights upon our liquidation, dissolution or winding-up. We refer to the common stock and the other classes and series of equity securities collectively may be referred to herein aswhich the "Junior Stock"), other
than any classes or series
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24shares of equity securities of the Company which by their terms specifically provide
for a ranking on a parity with (the "Parity Stock") orpreferred stock rank senior to (the "Senior
Stock") the Preferred Stock as to dividend rights and rights upon our liquidation, dissolution or winding upwinding-up of as the Company.“junior stock,” we refer to our equity securities that by their terms rank equal to the shares of preferred stock as the “parity stock,” and we refer to our equity securities that by their terms rank senior to the shares of preferred stock as the “senior stock.” The Preferred Stock shall beshares of preferred stock are junior to all our outstanding debt of the Company. The Preferred Stock shall be subject to
creation of Senior Stock, Parity Stockdebt. We may create and Junior Stockissue senior stock, parity stock and junior stock to the extent not expressly prohibited by the Certificateour certificate of Incorporation.
incorporation.
Dividends
Holders of shares of Preferred Stock shall beour preferred stock are entitled to receive, when, as and if declared by the Boardour board of Directorsdirectors, out of our assets of the Company legally available for payment, dividends, or distributions in cash, property or other assets of the Companyour company or in Securitiessecurities of the Companyour company or from any other source as the Boardour board of Directorsdirectors in theirits discretion shall determinedetermines and at suchthe dates and at such rates per share per annumannual rate as described in the applicable Prospectus Supplement. Suchprospectus supplement. This rate may be fixed or variable or both. Each declaredauthorized dividend shall beis payable to Holdersholders of record as they appear at the close of business on the books of our company on the Company on such record dates,date, not more than 90 calendar days preceding the payment dates therefor,date, as are determined by the Boardour board of Directors (each of such dates, a "Record Date").
Suchdirectors.
These dividends may be cumulative or noncumulative, as described in the applicable Prospectus Supplement.prospectus supplement. If dividends on a series of Preferred Stockpreferred stock are noncumulative and if the Boardour board of Directorsdirectors fails to declareauthorize a dividend in respect of a dividend period with respect to suchthat series, then Holdersholders of those shares of such Preferred Stockpreferred stock will have no right to receive a dividend in respect of suchthat dividend period, and the Companywe will have no obligation to pay the dividend for suchthat period, whether or not dividends are declared payableauthorized on any future dividend payment dates. If dividends of a series of Preferred Stockpreferred stock are cumulative, the dividends on suchthose shares will accrue from and after the date set forthstated in the applicable Prospectus Supplement.
prospectus supplement.
No full dividends shall be declaredauthorized or paid or set apart for payment on Preferred Stockpreferred stock of any series ranking, as to dividends, on a parityequally with or junior to the series of Preferred Stockpreferred stock offered by the applicable Prospectus
Supplementprospectus supplement for any period unless full dividends for the immediately preceding dividend period on such Preferred Stock (includingthe preferred stock, including any accumulation in respect of unpaid dividends for prior dividend periods, if dividends on such Preferred
Stockthe preferred stock are cumulative)cumulative, have been or contemporaneously are declaredauthorized and paid or declaredauthorized and a sum sufficient for the payment thereof is set apart for such payment. When dividends are not so paid in full, (oror a sum sufficient for such
full payment is not so set apart)apart, upon such shares of Preferred Stockthe preferred stock offered by the applicable prospectus supplement and any other Preferred Stock of the Companypreferred stock ranking on a parityequally as to dividends with the Preferred Stock,those shares of preferred stock, dividends upon such Preferred Stockthose shares of preferred stock and dividends on suchthe other Preferred Stock ranking on a parity with the Preferred Stock shallpreferred stock must be declared pro rataauthorized proportionately so that the amount of
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dividends declaredauthorized per share on such
Preferred Stockthose shares of preferred stock and suchthe other Preferred Stock ranking on a parity with the
Preferred Stock shallpreferred stock in all cases bear to each other the same ratio that accrued dividends for the then-current dividend period per share on such
Preferred Stock (includingthose shares of preferred stock, including any accumulation in respect of unpaid dividends for prior dividend periods, if dividends on such Preferred Stockthose shares of preferred stock are cumulative)cumulative, and accrued dividends, including required or permitted accumulations, if any, on shares of suchthe other Preferred Stock,preferred stock, bear to each other. No interest, or sum of money in lieu of interest, shallwill be payable in respect of any dividend payment(s) on Preferred Stock which may beshares of preferred stock that are in arrears. Unless full dividends on the series of Preferred Stockpreferred stock offered by the applicable Prospectus Supplementprospectus supplement have been declaredauthorized and paid or set apart for payment for the immediately preceding dividend period, (includingincluding any accumulation in respect of unpaid dividends for prior dividend periods, if dividends on such Preferred Stock are cumulative), (a) no cash dividend or distribution (other than in shares of
Junior Stock) may be declared, set aside or paid on the Junior Stock, (b) the
Company may not, directly or indirectly, repurchase, redeem or otherwise
acquire any shares of its Junior Stock (or pay any monies into a sinking fund
for the redemption of any shares) except by conversion into or exchange for
Junior Stock, and (c) the Company may not, directly or indirectly, repurchase,
redeem or otherwise acquire any Preferred Stock or Parity Stock (or pay any
monies into a sinking fund for the redemption of any shares of any such stock)
otherwise than pursuant to pro rata offers to purchase or a concurrent
redemption of all, or a pro rata portion, of the shares of outstanding
Preferred Stock and shares of Parity Stock (except by conversion into or
exchange for Junior Stock).
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cumulative:
| · | no cash dividend or distribution, other than in shares of junior stock, may be authorized, set aside or paid on the junior stock, |
| · | we may not, directly or indirectly, repurchase, redeem or otherwise acquire any shares of junior stock, or pay any money into a sinking fund for the redemption of any shares, except by conversion into or exchange for junior stock, and |
| · | we may not, directly or indirectly, repurchase, redeem or otherwise acquire any preferred stock or parity stock, or pay any money into a sinking fund for the redemption of any shares, otherwise than in accordance with proportionate offers to purchase or a concurrent redemption of all, or a proportionate portion, of the outstanding preferred stock and shares of parity stock, except by conversion into or exchange for junior stock. |
Any dividend payment made on a series of Preferred Stock shallpreferred stock will first be credited against the earliest accrued but unpaid dividend due with respect to shares of suchthe series.
Redemption
The terms, if any, on which shares of Preferred Stockpreferred stock of any series may be redeemed will be set forthdescribed in the applicable Prospectus Supplement.
prospectus supplement.
Liquidation
In
If we voluntarily or involuntarily liquidate, dissolve or wind up our affairs, the event of a voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Company, the Holdersholders of a series of Preferred
Stockpreferred stock will be entitled, subject to the rights of creditors, but before any distribution or payment to the Holdersholders of Common Stock, Excess Stock (otherour common stock, excess stock, other than certain Excess Stockshares of excess stock resulting from the conversion of Preferred Stock)shares of preferred stock, or any Junior Stock on liquidation, dissolution or winding up of the Company,junior stock, to receive a liquidating distribution in the amount of the liquidation preference per share as set forthstated in the applicable Prospectus Supplementprospectus supplement plus accrued and unpaid dividends for the then-current dividend period, (includingincluding any accumulation in respect of unpaid dividends for prior dividend periods, if dividends on such series of Preferred Stockpreferred stock are cumulative).cumulative. If the amounts available for distribution with respect to the Preferred Stockour preferred stock and all other outstanding Parity Stockparity stock are not sufficient to satisfy the full liquidation rights of all the outstanding shares of Preferred Stockpreferred stock and Parity Stock,parity stock, then the Holdersholders of each series of suchthe stock will share ratably in any suchthe distribution of assets in proportion to the full respective preferential amount, (whichwhich in the case of Preferred Stockpreferred stock may include accumulated dividends)dividends, to which they are entitled. After payment of the full amount of the liquidation distribution, the Holdersholders of Preferred Stockpreferred stock will not be entitled to any further participation in any distribution of assets by the Company.
us.
Voting
Except as set forth
Unless provided in the Prospectus Supplement relating to a
particular series of Preferred Stockapplicable prospectus supplement or except as expressly required by applicable law, Holdersholders of shares of Preferred Stockpreferred stock will have no voting rights.
No Other Rights
The shares of a series of Preferred Stockpreferred stock will not have any preferences, conversion or other rights, voting powers, or relative, participating, optional orrestrictions, limitations as to dividends and other special rightsdistributions, qualifications, and terms and conditions of
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redemption except as set forthdescribed above or in the applicable Prospectus
Supplement, the Certificateprospectus supplement, our certificate of Incorporationincorporation and in the applicable Certificatecertificate of Designationdesignations or as otherwise required by law.
Transfer Agent and Registrar
The transfer agent for each series of Preferred Stockpreferred stock will be described in the related Prospectus Supplement.
prospectus supplement.
Restrictions on Ownership As discussed below, forof Preferred Stock
The Preferred Stock Beneficial Ownership Limit. Our certificate of incorporation contains a number of provisions that restrict the Companyownership and transfer of shares and are designed to qualifyprotect us against an inadvertent loss of REIT status. In order to maintain our qualification as a REIT under the Internal Revenue Code, not more than 50% in value of itsour outstanding shares of capital stock may be owned, directly or constructively, by five or fewer individuals (as defined
in the Code to include certain entities)at any time during the last half of a taxable year, and the shares of capital stock must be beneficially owned by 100 or more persons during at least 335 days of a taxable year of 12 months, (oror during a proportionate part of a shorter taxable year). Therefore,year. The Internal Revenue Code defines “individuals” to include some entities for the Certificate of
Incorporation contains, and the Certificate of Designation for each series of
Preferred Stock may contain, provisions restricting the ownership and transferpurposes of the Preferred Stock.
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In orderpreceding sentence. All references to prevent any Company stockholder from owning sharesa holder’s ownership of preferred stock in an
amount which would cause more than 50%this section assumes application of the valueapplicable attribution rules of the outstandingInternal Revenue Code under which, for example, a holder is deemed to own shares owned by his or her spouse.
Our certificate of the Company to be held by five or fewer individuals, the Certificate of
Incorporationincorporation contains a limitation that restricts stockholders from owning under the applicable attribution rules of the Code, more than that percentage
(which generally should not exceed 9.9%) of the outstanding shares of Preferred
Stockpreferred stock of any series as is established by the Board of Directors at the time it
authorizes the issuance of such series (the "Preferred Stock Beneficial
Ownership Limit"“preferred stock beneficial ownership limit”). The attribution rules which apply for purposes of the Common
Stock Beneficial Ownership Limit (as defined below) also apply for purposes of
the Preferred Stock Beneficial Ownership Limit. See "Description of Common
Stock -- Restrictions on Ownership." StockholdersInvestors should be aware that events other than a purchase or other transfer of Preferred Stockpreferred stock may result in ownership, under the applicable attribution rules of the Internal Revenue Code, of Preferred
Stockpreferred stock in excess of the Preferred Stock Beneficialpreferred stock beneficial ownership limit. The attribution rules which apply for purposes of the common stock beneficial ownership limit also apply for purposes of the preferred stock beneficial ownership limit. For more information about these attribution rules, see “Description of Common Stock—Restrictions on Ownership—Attribution Rules.” You should consult your own tax advisors concerning the application of the attribution rules of the Internal Revenue Code in your particular circumstances.
The Constructive Ownership Limit. StockholdersLimit. Holders of preferred stock also are subject to the constructive ownership limit, which restricts them from owning, under the applicable attribution rules of the Internal Revenue Code, more than 9.9% of the outstanding shares of preferred stock of any series. See “Description of Common Stock—Restrictions on Ownership—The Constructive Ownership Limit” below for more information about the constructive ownership limit.
The attribution rules of the Internal Revenue Code that apply for purposes of the constructive ownership limit differ from those that apply for purposes of the preferred stock beneficial ownership limit. See “Description of Common Stock—Restrictions on Ownership—The Constructive Ownership Limit” for more information about these attribution rules. Investors should be aware that under the applicable attribution rules of the Internal Revenue Code, events other than a purchase or other transfer of preferred stock may result in ownership of preferred stock in excess of the constructive ownership limit. We urge investors to consult their own tax advisors concerning the application of the attribution rules of the Internal Revenue Code in their particular circumstances.
Holders
Issuance of PreferredExcess Stock are also subject toif the Constructive
Ownership Limit (as defined below in "DescriptionLimits Are Violated. Our certificate of Common Stock --
Restrictions on Ownership"), which restricts them from owning, under the
applicable attribution rules of the Code, more than 9.9% of the outstanding
shares of Preferred Stock of any series. The attribution rules which apply for
purposes of the Constructive Ownership Limit differ from those that apply for
purposes of the Preferred Stock Beneficial Ownership Limit. See "Description of
Common Stock -- Restrictions on Ownership." Stockholders should be aware that
events other than a purchase or other transfer of Preferred Stock may result in
ownership, under the applicable attribution rules of the Code, of Preferred
Stock in excess of the Constructive Ownership Limit. Stockholders should
consult their own tax advisors concerning the application of the attribution
rules of the Code in their particular circumstances.
The Certificate of Incorporationincorporation provides that a transfer of shares of Preferred Stockpreferred stock that would otherwise result in ownership, under the applicable attribution rules of the Internal Revenue Code, of Preferred Stockpreferred stock in excess of the Preferred
Stock Beneficial Ownership Limitpreferred stock beneficial ownership limit or the Constructive Ownership Limit,constructive ownership limit, or which would cause the shares of capital stock of the CompanyAlexander’s to be beneficially owned by fewer than 100 persons, will be null and voidhave no effect and the purported transferee will acquire no rights or economic interest in such Preferred Stock.preferred stock. In addition, Preferred Stockpreferred stock that would otherwise be owned, under the applicable attribution rules of the Internal Revenue Code, in excess of the Preferred Stock Beneficial
Ownership Limitpreferred stock beneficial ownership limit or the Constructive Ownership Limitconstructive ownership limit will be automatically exchanged for shares of Excess Stock thatexcess stock. These shares of excess stock will be transferred, by operation of law, to the Companyus as trustee of a trust for the exclusive benefit of a beneficiary designated by the purported transferee or purported Holder.holder. While
so held in trust, the trustee shall vote the shares of Excess Stockexcess stock in the same proportion as the Holdersholders of the Common Stock and Preferred Stock,
respectively, shall vote and suchoutstanding shares of Excess Stock are not entitled to
participate in any dividends or distributions made by the Company.preferred stock have voted. Any dividends or distributions received by the purported transferee or other purported Holderholder of such Excess Stock prior to the excess stock before our discovery by the Company of the automatic exchange for shares of Excess Stock shallexcess stock must be repaid to the
Companyus upon demand.
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If the purported transferee or purported Holderholder elects to designate a beneficiary of an interest in the trust with respect to such Excess Stock,the excess stock, he or she may only designate a person whose ownership of the shares will not violate the Preferred Stock
Beneficial Ownership Limitpreferred stock beneficial ownership limit or the Constructive Ownership Limit may be
designated, at which timeconstructive ownership limit. When the shares of Excess Stockdesignation is made, the excess stock will be automatically exchanged for shares of Preferred Stockpreferred stock of the same class as the Preferred
Stock whichpreferred stock that were originally exchanged for such Excess Stock. The Certificatethe excess shares. Our certificate of Incorporationincorporation contains provisions designed to ensure that the purported transferee or other purported Holderholder of the Excess Stockshares of excess stock may not receive, in return for such a transfertransferring an interest in the trust with respect to the excess stock, an amount that reflects any appreciation in the shares of Preferred Stockpreferred stock for which suchthe shares of Excess Stockexcess stock were exchanged during the period that suchthe shares of Excess Stockexcess stock were outstanding but will bear the burden of any decline in value during suchthat period. Any amount received by a purported transferee or other purported Holderholder for designating a beneficiary in excess of the amount permitted to be received must be turned over to the Company. The Certificateus. Our certificate of Incorporationincorporation provides that the Companywe may purchase any shares of Excess Stockexcess stock that have been automatically exchanged for shares of Preferred Stockpreferred stock as a result of a purported transfer or other event. The price at which the Companywe may purchase such Excess Stock shallthe shares of excess stock will be equal to the lesser of (i) in
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the case of shares of Excess Stock resulting from a purported transfer for
value, the price per share in the purported transfer that resulted in the
automatic exchange for shares of Excess Stock or, in the case of Excess Stock
resulting from some other event, the market price of the shares of Preferred
Stock exchanged on the date of the automatic exchange for shares of Excess
Stock and (ii) the market price of the shares of Preferred Stock exchanged for
such shares of Excess Stock on the date that the Company accepts the deemed
offer to sell such Excess Stock. The Company'sof:
| · | in the case of shares of excess stock resulting from a purported transfer for value, the price per share in the purported transfer that resulted in the automatic exchange for shares of excess stock or, in the case of excess stock resulting from some other event, the market price of the shares of preferred stock exchanged on the date of the automatic exchange for shares of excess stock, and |
| · | the market price of the shares of preferred stock exchanged for such shares of excess stock on the date that we accept the deemed offer to sell the excess stock. |
Our purchase right with respect to Excess Stock shallexcess stock will exist for 90 days, beginning on the date that the automatic exchange for shares of Excess Stockexcess stock occurred or, if the Companywe did not receive a notice concerning the purported transfer that resulted in the automatic exchange for shares of Excess Stocks,excess stock, the date that the Boardour board of Directorsdirectors determines in good faith that an exchange for Excess Stockexcess stock has occurred.
The Board
Other Provisions Concerning the Restrictions on Ownership. Our board of Directorsdirectors may in its discretion exempt certain persons from the Preferred Stock Beneficial Ownership Limitpreferred stock beneficial ownership limit or the Constructive
Ownership Limitconstructive ownership limit if evidence satisfactory to the Boardour board of Directorsdirectors is presented showing that such exemption will not jeopardize the Company'sour status as a REIT under the Internal Revenue Code. As a conditionBefore granting an exemption of such exemption, the Boardthis kind, our board of Directorsdirectors may require a ruling from the Internal Revenue Service and/orIRS, an opinion of counsel satisfactory to it and/orand representations and undertakings from the applicant with respect to preserving theour REIT status of the Company.
status.
The Board of Directors may, at any time, determine that the foregoing restrictions on ownership and transfer shallwill not apply if our board of directors determines that it is no longer apply.
in our best interests to attempt to qualify, or to continue to qualify, as a REIT.
Sections 382 and 383 of the Internal Revenue Code of 1986, as amended,
impose limitations upon the utilization of a corporation'scorporation’s net operating loss and credit carryforwards and certain other tax attributes, following significant changes in the corporation'scorporation’s stock ownership. In order to preserve the Company'sour ability to use its net operating loss carryforwards to reduce its
taxable income, the Certificateour certificate of Incorporationincorporation also contains, and the Certificatecertificate of Designationdesignations for each series of Preferred Stockpreferred stock may contain, additional provisions restricting the ownership of Preferred Stockour outstanding stock (the "Section“Section 382 Ownership Restrictions"ownership restrictions”). The Section 382 Ownership Restrictionsownership restrictions merely reduce the risk of certain occurrences that could cause such a limitation to arise. It is still possible that, due to transfers (either directly or indirectly) of the Company'sour outstanding shares, the Companywe could become subject to a limitation under SectionsSection 382 andor 383.
The Certificate
Our certificate of Incorporationincorporation provides, in general, that, subject to the exceptions described in the next paragraph, no person may acquire shares of the Company (orour company, or options or warrants to acquire such shares)shares, if as a result such person (or another person to which such shares were attributed under certain complex attribution rules, which differ in certain respects from those that apply for purposes of the Preferred Stock Beneficial Ownership Limitpreferred stock beneficial ownership limit or the Constructive Ownership Limit)constructive ownership limit) would own, directly or under such attribution rules, 5% or more of the class of such outstanding shares (hereinafter, such person's "Ownership Interest Percentage"person’s “ownership interest percentage”). In addition, subject to the exceptions described in the next paragraph, no person whose Ownership Interest
Percentageownership interest percentage of a class of shares equals or exceeds 5% can acquire or transfer such shares, (oror options or warrants to acquire such shares).shares. The foregoing restrictions apply independently to each class of the Company'sour outstanding stock.
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The foregoing restrictions do not apply to (i) acquisitions and transfers of Common Stockcommon stock by certain persons (orand their affiliates whose ownership interest percentage of persons), whose
Ownership Interest Percentage of Common Stockcommon stock on September 21, 1993 was 5% or more, (ii) transfers of shares pursuant to an offering by the Company,us, to the extent determined by the Boardour board of Directors,directors, and (iii) other transfers of shares specifically approved by the Company's Boardour board of Directors.
directors.
Transfers of shares, options or warrants in violation of the Section 382 Ownership Restrictionsownership restrictions would be void, and the transferee would acquire no rights in such shares, options or warrants. Thus, a purported acquiror would have no right to vote such shares or to receive dividends. Moreover, upon our demand, by the Company, a purported acquiror of shares, options or warrants would be required to transfer them to an agent designated by the Company.us. The agent, generally, would sell such shares, options or warrants, remit the proceeds thereof to the purported acquiror to the extent of such person'sperson’s purchase price for suchthe shares and, to the extent possible, remit -25-
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the balance of the proceeds to such person'sperson’s transferor. A similar procedure would be applied to any dividends paid to, and to the proceeds of any resale of shares, options or warrants by, the purported acquiror.
The Board
Our board of Directorsdirectors has the authority to designate a date as of which the Section 382 Ownership Restrictionsownership restrictions will no longer apply.
All certificates representing shares of Preferred Stockpreferred stock will bear a legend referring to the restrictions described above.
All persons who own, directly or by virtue of the applicable attribution rules of the Internal Revenue Code, more than 2% of the outstanding Preferred Stockpreferred stock of any series must give a written notice to the Companyus containing the information specified in the Certificateour certificate of Incorporationincorporation by January 3031 of each year. In addition, each stockholder shall upon demandwill be required to disclose to the Company suchus any information as the Companywe may request, in good faith, in order to determine the Company'sour status as a REIT or to comply with Treasury Regulations promulgated under the REIT provisions of the Internal Revenue Code.
DEPOSITARY SHARES
Depositary Shares
We may, at our option, elect to offer depositary shares, which represent receipts for fractional interests in shares of preferred stock rather than full shares of preferred stock. Each depositary share will be evidenced by a depositary receipt which will represent a fraction of a share of a particular series of preferred stock and will be issued as described below. The prospectus supplement relating to any series of depositary shares will state the fraction of a preferred share represented by each depositary share.
The description set forth below and in any Prospectus Supplement of certainthe material provisions of the Deposit Agreementdeposit agreement and of the Depositary Sharesdepositary shares and Depositary Receipts (each as defined below) does not purport to be completedepositary receipts is only a summary and is subject to and qualified in its entirety by reference to the forms of Deposit Agreementdeposit agreement and Depositary Receiptsdepositary receipts relating to each series of the Preferred Stock whichdepositary shares that have been or will be filed withas an exhibit to or incorporated by reference in the Commissionregistration statement of which this prospectus is a part, at or prior tobefore the time of the offeringissuance of sucha series of the Preferred Stock. If so
indicated in a Prospectus Supplement, thedepositary shares. The particular terms of any series of Depositary
Shares may differ from the terms set forth herein.
General
The Company may, at its option, elect to offer receipts fordepositary shares representing fractional interests ("Depositary Shares") in shares of Preferred Stock, rather than full
shares of Preferred Stock. In such event, receipts ("Depositary Receipts") for
Depositary Shares, each of which will represent a fraction (to be set forth in
the Prospectus Supplement relating to aany particular series of Preferred Stock)
of a share of a particular series of Preferred Stock,preferred stock will be issued as
described below.
in the applicable prospectus supplement, which will supplement the information in this prospectus.
The shares of any series of Preferred Stockpreferred stock represented by Depositary
Sharesdepositary shares will be deposited under a Deposit Agreement (the "Deposit Agreement")deposit agreement between the Companyus and the depositary (the "Depositary").depositary. Subject to the terms
of the Deposit Agreement,deposit agreement, each owner of a Depositary Sharedepositary share will be entitled, in proportion to the applicable fraction of a share of Preferred Stockpreferred stock represented by such Depositary Share,depositary share, to all the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends and preferencesother distributions, qualifications and terms and conditions of redemption of the Preferred
Stockpreferred stock represented thereby (including dividend, voting, redemption, subscription
and liquidation rights).
by the depositary share.
Dividends and Other Distributions
The Depositarydepositary will distribute all cash dividends or other cash distributions received in respect of the Preferred Stockpreferred stock to the record Holdersholders of Depositary Sharesdepositary shares relating to such shares of Preferred Stockpreferred stock in proportion to the numbers of such Depositary Sharesdepositary shares owned by such Holders.
In the event ofholders.
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If we make a distribution other than in cash, the Depositarydepositary will distribute property received by it to the record Holdersholders of Depositary Sharesdepositary shares in an equitable manner, unless the Depositarydepositary determines that it is not feasible to make suchthe distribution, in which case the Depositarydepositary may sell such property and distribute the net proceeds from such sale to the holders.
Withdrawal of Preferred Stock
Upon surrender of depositary receipts at the corporate trust office of the depositary, unless the related depositary shares have previously been called for redemption or converted into excess shares or otherwise, each depositary receipt holder will be entitled to delivery at the depositary’s corporate trust office, to or upon the holder’s order, the number of whole or fractional shares of the class or series of preferred stock and any money or other property represented by the depositary shares evidenced by the depositary receipts. Holders of depositary receipts will be entitled to receive whole or fractional shares of the related class or series of preferred stock on the basis of the fraction of a share of preferred stock represented by each depositary share as specified in the applicable prospectus supplement, but holders of the preferred stock will not be entitled to receive depositary shares representing the preferred stock after exchanging the depositary shares for preferred stock. If the depositary receipts delivered by the holder evidence a number of depositary shares in excess of the number of depositary shares representing the number of shares of preferred stock to be withdrawn, the depositary will deliver to the holder at the same time a new depositary receipt evidencing such Holders.
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excess number of depositary shares.
Redemption of Depositary Shares
If a series of Preferred Stockpreferred stock represented by Depositary Sharesdepositary shares is subject to redemption, the Depositary Sharesdepositary shares will be redeemed from the proceeds received by the Depositarydepositary resulting from the redemption, in whole or in part, of suchthe series of Preferred Stockpreferred stock held by the Depositary.depositary. The redemption price per Depositary Sharedepositary share will be equal to the applicable fraction of the redemption price per share payable with respect to such series of the Preferred Stock.preferred stock. Whenever the Company redeemswe redeem shares of Preferred Stockpreferred stock held by the Depositary,depositary, the Depositarydepositary will redeem as of the same redemption date the number of Depositary Sharesdepositary shares representing the redeemed shares of Preferred Stock so redeemed.preferred stock. If fewer than all the Depositary Sharesdepositary shares are to be redeemed, the Depositary Sharesdepositary shares to be redeemed will be selected by lot, pro rataproportionately or by any other equitable method as may be determined by the Depositary.
depositary.
Voting the Preferred Stock
Upon receipt of notice of any meeting at which the Holdersholders of the Preferred Stockpreferred stock are entitled to vote, the Depositarydepositary will mail the information contained in such noticesthe notice of meeting to the record Holdersholders of the Depositary
Sharesdepositary shares relating to such Preferred Stock.the preferred stock. Each record Holderholder of such Depositary
Sharesthese depositary shares on the record date (which will be the same date as the record date for
the Preferred Stock) will be entitled to instruct the Depositarydepositary as to the exercise of the voting rights pertaining to the amount of the Preferred Stockpreferred stock represented by such Holder's Depositary Shares.the holder’s depositary shares. The Depositaryrecord date for voting the depositary shares will be the same as the record date for voting the preferred stock. The depositary will endeavor, insofar as practicable, to vote the amount of the Preferred Stockpreferred stock represented by such Depositary Sharesthe depositary shares in accordance with suchthe instructions, and the Companywe will agree to take all reasonable action which may be deemed necessary by the Depositarydepositary in order to enable the Depositarydepositary to do so. The Depositarydepositary will abstain from voting the Preferred Stockpreferred stock to the extent it does not receive specific instructions from the Holderholder of Depositary Sharesdepositary shares representing such
Preferred Stock.
those shares of preferred stock.
Amendment and Termination of the Deposit Agreement
The
We and the depositary may amend the form of Depositary Receiptdepositary receipt evidencing the Depositary Sharesdepositary shares and any provision of the Deposit Agreement maydeposit agreement at any time be amended by agreement
between the Company and the Depositary.time. However, any amendment whichthat materially and adversely alters the rights of the Holdersholders of Depositary Sharesdepositary shares will not be effective unless such amendment has been approved by the Holdersholders of at least a majority of the Depositary Sharesdepositary shares then outstanding.outstanding approve the amendment. The Deposit Agreementdeposit agreement will only terminate if (i)(a) all outstanding Depositary Sharesdepositary shares have been redeemed or (ii)(b) there has been a final distribution in respect of the Preferred Stockpreferred stock in connection with any liquidation, dissolution or winding upwinding-up of the Companyour affairs and suchthat distribution has been distributed to the Holdersholders of the related Depositary
Shares.
depositary shares.
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Charges of Depositary
The Company
We will pay all transfer and other taxes and governmental charges arising solely from the existence of the depositary arrangements. The
CompanyWe will pay charges of the Depositarydepositary in connection with the initial deposit of the Preferred Stockpreferred stock and issuance of Depositary Receipts,depositary receipts, all withdrawals of Preferred Stockpreferred stock by owners of Depositary Sharesdepositary shares and any redemption of the Preferred Stock.preferred stock. Holders of Depositary Receiptsdepositary receipts will pay other transfer and other taxes and governmental charges and such other charges as are expressly provided in the Deposit Agreementdeposit agreement to be for their accounts.
account.
Resignation and Removal of Depositary
The Depositarydepositary may resign at any time by delivering to the Companyus notice of its election to do so, and the Companywe may at any time remove the Depositary, any suchdepositary. The resignation or removal towill take effect upon the appointment of a successor Depositarydepositary and its acceptance of suchthe appointment. SuchThe successor Depositarydepositary must be
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30 appointed within 60 days after delivery of the notice of resignation or removal and must be a bank or trust company having its principal office in the United States and having a combined capital and surplus of at least $50,000,000.
Restrictions on Ownership
In order to safeguard the Company against an inadvertent loss of our REIT status, the Deposit Agreementdeposit agreement will contain provisions similar to those in the
Certificateour certificate of Incorporationincorporation restricting the ownership and transfer of Depositary Shares.depositary shares. Such restrictions will be described in the applicable Prospectus Supplement.
Miscellaneous
prospectus supplement.
Reports; Liability of Depositary and Alexander’s, Inc.
The Depositarydepositary will forward all reports and communications from the
Companyus which are delivered to the Depositarydepositary and which the Company iswe are required, or otherwise determinesdetermine, to furnish to the Holdersholders of the Preferred Stock.
preferred stock.
Neither the Depositarydepositary nor the CompanyAlexander’s will be liable if it is prevented or delayed by law or any circumstance beyond its control in performing its obligations under the Deposit Agreement.deposit agreement. The obligations of the
CompanyAlexander’s and the Depositarydepositary under the Deposit Agreementdeposit agreement will be limited to performance in good faith of their duties thereunderunder the deposit agreement, and they will not be obligated to prosecute or defend any legal proceeding in respect of any Depositary Sharesdepositary shares or Preferred Stockpreferred stock unless satisfactory indemnity is furnished. They may rely upon written advice of counsel or accountants, or information provided by persons presenting Preferred Stockpreferred stock for deposit, Holdersholders of Depositary Sharesdepositary shares or other persons believed to be competent and on documents believed to be genuine.
DESCRIPTION OF COMMON STOCK
The following description of the material terms of our common stock is only a summary and is qualified in its entirety by reference to, the provisions contained in our certificate of incorporation and the by-laws governing the common stock.
As of August 4, 1995, 5,000,850November 24, 2008, 5,173,450 and 5,081,590 shares of Common Stockcommon stock were issued and outstanding. The Common Stock of the Companyoutstanding, respectively. Our common stock is listed on the NYSE under the symbol "ALX".
The“ALX.”
Dividend and Voting Rights of Holders of Common Stock
Holders of our common stock are entitled to receive dividends when, if and as declaredauthorized by the Boardour board of Directors of the Companydirectors out of assets legally available therefor, provided that if any shares of Preferred Stock are atto pay dividends.
Each common share entitles the time outstanding, the payment of dividends on Common Stock or other
distributions (including purchases of Common Stock) may be subject to the
declaration and payment of full cumulative dividends, and the absence of
arrearages in any mandatory sinking fund, on outstanding Preferred Stock.
The Holders of Common Stock are entitledholder to one vote for each share on all matters voted on by stockholders, including elections of directors. There is no cumulative voting in the election of directors, which means that the Holdersholders of a majority of the outstanding Common Stockcommon stock can elect all of the directors then standing for election. The
Our certificate of incorporation requires the affirmative vote of two-thirds of the outstanding shares of our stock entitled to vote before we may merge with another corporation.
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Holders of Common Stockcommon stock do not have any conversion, redemption or preemptive rights to subscribe to any securities of the Company.our company. In the event of theour dissolution, liquidation or winding up,
Holderswinding-up, after the payment or provision of Common Stockour debts and other liabilities and the preferential amounts to which holders of our preferred stock are entitled, if any such preferred stock is outstanding, the holders of the common stock are entitled to share ratably in any assets remaining after the satisfaction in full of the prior rights of creditors, including
holders of the Company's indebtedness, and the aggregate liquidation preference
of any Preferred Stock then outstanding.
for distribution to shareholders.
The Common Stockcommon stock has equal dividend, distribution, liquidation and other rights, and shall havethere are no preference, appraisal or exchange rights.rights applicable thereto. All outstanding shares of Common Stockcommon stock are, and any shares of Common Stockcommon stock offered by a Prospectus Supplement,prospectus supplement, upon issuance, will be, fully paid and non-assessable.
Thenonassessable.
Wachovia Bank, N.A., is the transfer agent for the Common Stock is Chemical Bank, New York,
New York.
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common stock.
Restrictions on Ownership of Common Stock
The CertificateCommon Stock Beneficial Ownership Limit. Our certificate of Incorporationincorporation contains a number of provisions whichthat restrict the ownership and transfer of shares and which are designed to safeguard the Companyus against an inadvertent loss of REIT status. These provisions also seek to deter non-negotiated acquisitions of, and proxy fights for, us by third parties. In order to prevent any Company stockholder from owning shares in an amount which would
causemaintain our qualification as a REIT under the Internal Revenue Code, not more than 50% inof the value of theour outstanding shares of the Company tocapital stock may be owned, directly or constructively, by five or fewer individuals at any time during the Certificatelast half of Incorporation contains a limitation that restricts, with certain exceptions, stockholders from owning,
undertaxable year and the shares of capital stock must be beneficially owned by 100 or more persons during at least 335 days of a taxable year of 12 months, or during a proportionate part of a shorter taxable year. The Internal Revenue Code defines “individuals” to include some entities for purposes of the preceding sentence. All references to a holder’s ownership of common stock in this section assumes application of the applicable attribution rules of the Internal Revenue Code under which, for example, a holder is deemed to own shares owned by his or her spouse.
Our certificate of incorporation contains a limitation that restricts stockholders from owning more than 4.9% of the outstanding shares of Common Stock (the "Common Stock Beneficial Ownership
Limit").common stock. In certain circumstances, the Boardour board of Directorsdirectors may reduce the Common Stock Beneficial Ownership Limitcommon stock beneficial ownership limit to as lowlittle as 2%, but only if any person who would ownowns shares in excess of such new limit could continue to do so. The
BoardOur board of Directorsdirectors has, subject to certain conditions and limitations, exempted our manager, Vornado Realty Trust, and certain of its affiliates from the Common Stock Beneficial
Ownership Limitation.
Stockholderscommon stock beneficial ownership limit. As a result, it is less likely as a practical matter that another holder of common stock could obtain an exemption.
Attribution Rules. Investors should be aware that under the applicable attribution rules of the Internal Revenue Code, events other than a purchase or other transfer of Common Stockcommon stock can result in ownership under the applicable
attribution rules of the Code, of Common Stockcommon stock in excess of the Common Stock
Beneficial Ownership Limit.common stock beneficial ownership limit. For instance, if two stockholders, each of whom owns under the applicable attribution rules of the Code 3% of the outstanding Common Stock,common stock, were to marry, then after their marriage both stockholders would be deemed to own under the applicable attribution rules of the Code, 6% of the outstanding shares of Common Stock,common stock, which is in excess of the Common Stock Beneficial
Ownership Limit.common stock beneficial ownership limit. Similarly, if a stockholder who owns under the applicable
attribution rules of the Code, 4% of the outstanding Common Stockcommon stock were to purchase a 50% interest in a corporation which owns 3% of the outstanding Common Stock,common stock, then the stockholder would be deemed to own under the applicable attribution
rules of the Code, 5.5% of the outstanding shares of Common Stock. Stockholderscommon stock. You should consult theiryour own tax advisersadvisors concerning the application of the attribution rules of the Internal Revenue Code in theiryour particular circumstances.
The Constructive Ownership Limit. Under the Internal Revenue Code, rental income received by a REIT from persons inwith respect to which the REIT is treated, under the applicable attribution rules of the Internal Revenue Code, as owning a 10% or greater interest does not constitute qualifying income for purposes of the income requirements that REITs must satisfy. For these purposes, a REIT is treated as owning any stock owned, under the applicable attribution rules of the Internal Revenue Code, by a person that owns 10% or more of the value of the outstanding shares of the REIT. Therefore,The attribution rules of the Internal Revenue Code applicable for these purposes are different from those applicable with respect to the common stock beneficial ownership limit. All references to a stockholder’s ownership of common stock in this section assume application of the applicable attribution rules of the Internal Revenue Code.
In order to ensure that our rental income of the Company will not be treated as nonqualifying income under the rule described above,in the preceding paragraph, and thus to ensure that therewe will not be an
inadvertent loss ofinadvertently lose our REIT status as a result of the ownership of shares of a tenant, or a person that holds an interest in a tenant, the Certificateour certificate of
Incorporation also
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incorporation contains an ownership limit that restricts, with certain exceptions, stockholders from owning under the applicable attribution rules of
the Code (which are different from those applicable with respect to the Common
Stock Beneficial Ownership Limit), more than 9.9% of the outstanding shares of any class (the "Constructive Ownership Limit"“common stock beneficial ownership limit”).
Stockholders should be aware that events other than a purchase or other transfer of shares can result in ownership, under the applicable attribution rules of the Internal Revenue Code, of shares in excess of the Constructive
Ownership Limit.constructive ownership limit. As the attribution rules that apply with respect to the Constructive Ownership Limitconstructive ownership limit differ from those that apply with respect to the Common Stock Beneficial Ownership Limit,common stock beneficial ownership limit, the events other than a purchase or other transfer of shares which can result in share ownership in excess of the Constructive Ownership Limitconstructive ownership limit can differ from those which can result in share ownership in excess of the Common Stock Beneficial Ownership Limit.
Stockholderscommon stock beneficial ownership limit. You should consult theiryour own tax advisersadvisors concerning the application of the attribution rules of the Internal Revenue Code in theiryour particular circumstances.
The Certificate
Issuance of IncorporationExcess Stock if the Ownership Limits Are Violated. Our certificate of incorporation provides that a transfer of shares of Common Stockcommon stock that would otherwise result in ownership, under the applicable attribution rules of the Internal Revenue Code, of Common Stockcommon stock in excess of the Common Stock
Beneficial Ownership Limitcommon stock beneficial ownership limit or the Constructive Ownership Limit,constructive ownership limit, or which would cause the shares of beneficial interestcapital stock of the CompanyAlexander’s to be beneficially owned by fewer than 100 persons, will be null and voidwould have no effect and the purported transferee willwould acquire no rights or economic interest in such Common Stock.common stock. In addition, Common
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Stockcommon stock that would otherwise be owned, under the applicable attribution rules of the Internal Revenue Code, in excess of the Common Stock Beneficial Ownership Limitcommon stock beneficial ownership limit or the Constructive Ownership Limitconstructive ownership limit will be automatically exchanged for shares of Excess Stock that willexcess stock. These shares of excess stock would be transferred, by operation of law, to the Companyus as trustee of a trust for the exclusive benefit of a beneficiary designated by the purported transferee or purported Holder.holder. While so held in trust, the trustee shall vote the shares of Excess Stockexcess stock in the same proportion as the Holdersholders of the Common Stock and Preferred Stock, respectively, shall vote and suchoutstanding shares of Excess Stock are not entitled to participate in any dividends or
distributions made by the Company.common stock have voted. Any dividends or distributions received by the purported transferee or other purported Holderholder of such Excess Stock prior
to the excess stock before our discovery by the Company of the automatic exchange for Excess Stock
shallshares of excess stock must be repaid to the Companyus upon demand.
If the purported transferee or purported Holderholder elects to designate a beneficiary of an interest in the trust with respect to such Excess Stock,the excess stock, he or she may only designate a person whose ownership of the shares will not violate the Common Stock
Beneficial Ownership Limitcommon stock beneficial ownership limit or the Constructive Ownership Limit may be
designated, at which timeconstructive ownership limit. When the shares of Excess Stockdesignation is made, the excess stock will be automatically exchanged for sharescommon stock. Our certificate of Common Stock. The Certificate of Incorporationincorporation contains provisions designed to ensure that the purported transferee or other purported Holderholder of shares of Excess Stockexcess stock may not receive in return for such a transfertransferring an interest in the trust with respect to the excess stock, an amount that reflects any appreciation in the shares of Common Stockcommon stock for which suchthe shares of Excess Stockexcess stock were exchanged during the period that suchthe shares of Excess Stockexcess stock were outstanding but will bear the burden of any decline in value during suchthat period. Any amount received by a purported transferee or other purported Holderholder for designating a beneficiary in excess of the amount permitted to be received must be turned over to the Company. The Certificateus. Our certificate of Incorporationincorporation provides that the Companywe may purchase any shares of Excess Stockexcess stock that have been automatically exchanged for shares of Common Stockcommon stock as a result of a purported transfer or other event. The price at which the Companywe may purchase such Excess Stock shallthe excess stock will be equal to the lesser of (i) in the case of
Excess Stock resulting from a purported transfer for value, the price per share
in the purported transfer that resulted in the automatic exchange for Excess
Stock or, in the case of Excess Stock resulting from some other event, the
market price of the Common Stock exchanged on the date of the automatic
exchange for Excess Stock and (ii) the market price of the Common Stock
exchanged for such Excess Stock on the date that the Company accepts the deemed
offer to sell such Excess Stock. The Company'sof:
| · | in the case of shares of excess stock resulting from a purported transfer for value, the price per share in the purported transfer that resulted in the automatic exchange for shares of excess stock or, in the case of excess stock resulting from some other event, the market price of the shares of common stock exchanged on the date of the automatic exchange for excess stock, and |
| · | the market price of the shares of common stock exchanged for the excess stock on the date that we accept the deemed offer to sell the excess stock. |
Our purchase right with respect to Excess Stock shallexcess stock will exist for 90 days, beginning on the date that the automatic exchange for shares of Excess Stockexcess stock occurred or, if the Companywe did not receive a notice concerning the purported transfer that resulted in the automatic exchange for shares of Excess Stock,excess stock, the date that the Boardour board of Directorsdirectors determines in good faith that an exchange for Excess Stockexcess stock has occurred.
The Board
Other Provisions Concerning the Restrictions on Ownership. Our board of Directors of the Companydirectors may in its discretion exempt certain persons from the Common Stock Beneficial Ownership Limitcommon stock beneficial ownership limit or the Constructive Ownership Limit,constructive ownership limit if evidence satisfactory to the Boardour board of Directorsdirectors is presented showing that such exemption will not jeopardize the
Company'sour status as a REIT under the Internal Revenue Code. As a conditionBefore granting an exemption of such exemption,
the Boardthis kind, our board of Directorsdirectors may
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require a ruling from the Internal Revenue Service
and/orIRS, an opinion of counsel satisfactory to it and/orand representations and undertakings from the applicant with respect to preserving theour REIT statusstatus.
Our board of the Company.
The Board of Directorsdirectors has, subject to certain conditions and limitations, exempted our manager, Vornado Realty Trust, and certain of its affiliates from the Common
Stock Beneficial Ownership Limitation.common stock beneficial ownership limit. As a result, it is unlikelyless likely as a practical matter that another Holderholder of Common Stockcommon stock could obtain an exemption.
The Board of Directors may, at any time, determine that the foregoing restrictions on ownership and transfer shallwill not apply if our board of directors determines that it is no longer apply.
in our best interests to attempt to qualify, or continue to qualify, as a REIT.
Sections 382 and 383 of the Internal Revenue Code of 1986, as amended,
impose limitations upon the utilization of a corporation'scorporation’s net operating loss and credit carryforwards and certain other tax attributes, following significant changes in the corporation'scorporation’s stock ownership. In order to preserve the Company'sour ability to use its net operating loss carryforwards to reduce its
taxable income, the Certificateour certificate of Incorporationincorporation also contains additional provisions restricting the ownership of the Company'sour outstanding shares (the "Section“Section 382 Ownership
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Restrictions"ownership restrictions”). The Section 382 Ownership Restrictionsownership restrictions merely reduce the risk of certain occurrences that could cause such a limitation to arise. It is still possible that, due to transfers (either directly or indirectly) of the
Company'sour outstanding shares, the Companywe could become subject to a limitation under SectionsSection 382 andor 383.
The Certificate
Our certificate of Incorporationincorporation provides, in general, that, subject to the exceptions described in the next paragraph, no person may acquire shares of the Company (orour company, or options or warrants to acquire such shares)shares, if as a result such person (or another person to which such shares were attributed under certain complex attribution rules, which differ in certain respects from those that apply for purposes of the Common Stock Beneficial Ownership Limitcommon stock beneficial ownership limit or the Constructive Ownership Limit)constructive ownership limit) would own, directly or under such attribution rules, 5% or more of the class of such outstanding shares (hereinafter, such person's "Ownership Interest Percentage"person’s “ownership interest percentage”). In addition, subject to the exceptions described in the next paragraph, no person whose Ownership Interest
Percentageownership interest percentage of a class of shares equals or exceeds 5% can acquire or transfer such shares, (oror options or warrants to acquire such shares).shares. The foregoing restrictions apply independently to each class of the Company'sour outstanding stock.
The foregoing restrictions do not apply to (i) acquisitions and transfers of shares of Common Stockcommon stock by certain persons (orand their affiliates whose ownership interest percentage of persons), whose Ownership Interest Percentage of Common Stockcommon stock on September 21, 1993 was 5% or more, (ii) transfers of shares pursuant to an offering by the
Company,us, to the extent determined by the Boardour board of Directors,directors, and (iii) other transfers of shares specifically approved by the Company's Boardour board of Directors.
directors.
Transfers of shares, options or warrants in violation of the Section 382 Ownership Restrictionsownership restrictions would be void, and the transferee would acquire no rights in such shares, options or warrants. Thus, a purported acquiror would have no right to vote such shares or to receive dividends. Moreover, upon our demand, by the Company, a purported acquiror of shares, options or warrants would be required to transfer them to an agent designated by the Company.us. The agent, generally, would sell such shares, options or warrants, remit the proceeds thereof to the purported acquiror to the extent of such person'sperson’s purchase price for suchthe shares and, to the extent possible, remit the balance of the proceeds to such person'sperson’s transferor. A similar procedure would be applied to any dividends paid to, and to the proceeds of any resale of shares, options or warrants by, the purported acquiror.
The Board
Our board of Directorsdirectors has the authority to designate a date as of which the Section 382 Ownership Restrictionsownership restrictions will no longer apply.
All certificates representing shares of common stock will bear a legend referring to the restrictions described above.
All persons who own, directly or by virtue of the applicable attribution rules of the Internal Revenue Code, more than 2% of the shares of outstanding Common
Stockcommon stock must give a written notice to the Companyus containing the information specified in the Certificateour certificate of Incorporationincorporation by January 31 of each year. In addition, each stockholder shall upon demand be required to disclose to the
Companyus such information as the Companywe may request, in good faith, in order to determine the Company'sour status as a REIT or to comply with Treasury Regulations promulgated under the REIT provisions of the Internal Revenue Code.
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IMPORTANT PROVISIONS OF DELAWARE LAW AND OUR CERTIFICATE OF INCORPORATION
AND BY-LAWS
The ownership restrictions described abovefollowing is a summary of important provisions of Delaware law and our certificate of incorporation and by-laws which affect us and our stockholders. The description below is intended as only a summary. You can access complete information by referring to Delaware General Corporation Law and our certificate of incorporation and by-laws.
Business Combinations with Interested Stockholders Under Delaware Law
Section 203 of the Delaware General Corporation Law prevents a publicly held corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless:
| · | before the date on which the person became an interested stockholder, the board of directors of the corporation approved either the business combination or the transaction in which the person became an interested stockholder, |
| · | the interested stockholder owned at least 85% of the outstanding voting stock of the corporation at the beginning of the transaction in which it became an interested stockholder, excluding stock held by directors who are also officers of the corporation and by employee stock plans that do not provide participants with the rights to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer, or |
| · | after the date on which the interested stockholder became an interested stockholder, the business combination is approved by the board of directors and the holders of two-thirds of the outstanding voting stock of the corporation voting at a meeting, excluding the voting stock owned by the interested stockholder. |
As defined in Section 203, an “interested stockholder” is generally a person owning 15% or more of the outstanding voting stock of the corporation. As defined in Section 203, a “business combination” includes mergers, consolidations, stock and assets sales and other transactions with the interested stockholder.
The provisions of Section 203 may have the effect of precluding acquisitiondelaying, deferring or preventing a change of control of Alexander’s, Inc.
Amendment of Our Certificate of Incorporation and By-Laws
Amendments to our certificate of incorporation must be approved by our board of directors. Unless otherwise required by law, our board of directors may amend our by-laws by a majority vote of the Company.
directors then in office.
Meetings of Stockholders
Under our by-laws, we will hold annual meetings of our stockholders at a date and time as determined by our board of directors, chairman, vice chairman or president. Our by-laws require advance notice for our stockholders to make nominations of candidates for our board of directors or bring other business before an annual meeting of our stockholders. The chairman or vice chairman shall call special meetings of our stockholders whenever stockholders owning at least a majority of our issued and outstanding shares entitled to vote on matters to be submitted to stockholders shall request in writing such a meeting.
Board of Directors
Our board of directors is divided into three classes. As the term of each class expires, directors in that class will be elected for a term of three years and until their successors are duly elected and qualified. These staggered terms may reduce the possibility of an attempt to change control of Alexander’s.
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DESCRIPTION OF DEBT WARRANTS
The Company
We may issue, Debt Warrantseither together with other debt securities or separately, debt warrants to purchase Debt Securities ("Debt
Warrants"). Debt Warrants may be issued independently or together withunderlying debt securities. We will issue debt warrants, if any, Debt
Securities and may be attached to or separate from such Debt Securities. The
Debt Warrants are to be issued under warrant agreements (each, a "Warrant
Agreement"“debt warrant agreement”) tothat would be entered into between the Companyus and a bank or trust company, as warrant agent (the "Warrant Agent"“debt warrant agent”), all as shall be set forth in the
Prospectus Supplement relating to Debt Warrants being offered pursuant thereto.
If so indicatedthat we will describe in a Prospectus Supplement,prospectus supplement.
General
You should read the applicable prospectus supplement for the terms of any Debt Warrants may
differ from the terms set forth below.
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The applicable Prospectus Supplement will describe the terms of Debt
Warrants offered thereby, the Warrant Agreement relating to such Debt Warrants
and the debt warrant certificates representing such Debt Warrants,warrants, including the following: (1) the title of such Debt Warrants; (2) the aggregate number of
such Debt Warrants; (3) the price or prices at which such Debt Warrants will be
issued and the procedures for adjusting such price; (4) the currency or
currencies, including composite currencies or currency units, in which the
price of such Debt Warrants may be payable; (5) the designation, aggregate
principal amount and terms of the Debt Securities purchasable upon exercise of
such Debt Warrants, and the procedures and conditions relating to the exercise
of such Debt Warrants; (6) the designation and terms of any related Debt
Securities with which such Debt Warrants are issued, and the number of such
Debt Warrants issued with each such Debt Security; (7) the currency or
currencies, including composite currencies or currency units, in which the
principal of (or premium, if any), or interest, if any, on the Debt Securities
purchasable upon exercise of such Debt Warrants will be payable; (8) the date,
if any, on and after which such Debt Warrants and the related Debt Securities
will be separately transferable; (9) the principal amount of Debt Securities
purchasable upon exercise of each Debt Warrant, and the price at which and the
currency, including composite currency or currency unit, in which such
principal amount of Debt Securities may be purchased upon such exercise; (10)
the date on which the right to exercise such Debt Warrants shall commence, and
the date on which such right shall expire; (11) the maximum or minimum number
of such Debt Warrants which may be exercised at any time; (12) a discussion of
material federal income tax considerations, if any; and (13) any other terms of
such Debt Warrants and terms, procedures and limitations relating to the
exercise of such Debt Warrants.
| · | the title and aggregate number of such debt warrants, |
| · | the initial offering price and the procedures for adjusting the initial offering price, |
| · | the currency, currencies or currency units in which the debt warrants are payable, |
| · | the designation, aggregate principal amount and other terms of the debt securities purchasable upon exercise of the debt warrants, |
| · | if applicable, the designation and terms of the debt securities with which the debt warrants are issued and the number of debt warrants issued with each debt security, |
| · | the currency, currencies or currency units in which the principal of, premium, if any, or interest, if any, is payable on the debt securities purchasable upon exercise of the debt warrants, |
| · | if applicable, the date on and after which the debt warrants and the related debt securities will be separately transferable, |
| · | the principal amount of debt securities purchasable upon exercise of one debt warrant and the price at which such principal amount of debt securities may be purchased upon such exercise, |
| · | the date on which the right to exercise the debt warrants will commence and the date on which such right will expire, |
| · | the maximum or minimum number of debt warrants which may be exercised at any time, |
| · | if applicable, a discussion of the material Federal income tax consequences applicable to the exercise of the debt warrants and to the debt securities purchasable upon the exercise of the debt warrants, and |
| · | any other terms of the debt warrants. |
Debt warrant certificates willmay be exchangeableexchanged for new debt warrant certificates of different denominations and, Debt Warrantsif in registered form, may be presented for registration of transfer, and may be exercised at the corporate trust office of the Warrant Agentdebt warrant agent or any other office indicated in the Prospectus Supplement.prospectus supplement relating thereto. Prior to the exercise of their Debt Warrants,
Holders of Debt Warrantsthe debt warrants, holders will not have any of the rights of Holdersholders of the Debt
Securitiesdebt securities purchasable upon such exercise and will not be entitled to payments of principal, of (or premium, if any)any, or interest, if any, on thesuch debt securities.
Exercise of Debt Securities purchasable upon such exercise.
EXERCISE OF DEBT WARRANTS
Warrants
Each Debt Warrantoffered debt warrant will entitle the Holder of such Debt Warrantholder thereof to purchase for cash such principal amount of Debt Securitiesunderlying debt securities at suchthe exercise price as shall in each case be set forth in, or be determinable as set forth
in,calculable from, the Prospectus Supplementprospectus supplement relating to the Debt Warrantssuch offered thereby.
Debt Warrants may be exercised at any time up to the close of business on the
expiration date set forth in the Prospectus Supplement relating to the Debt
Warrants offered thereby.debt warrants. After the close of business on the expiration date, unexercised Debt Warrantsdebt warrants will become void.
Debt Warrants
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You may be exercised as set forth in the Prospectus
Supplement relatingexercise debt warrants by payment to the Debt Warrants offered thereby.debt warrant agent of the applicable exercise price and by delivery to the debt warrant agent of the related debt warrant certificate, properly completed. Upon receipt of such payment and the warrant certificate properly completed and duly executeddebt warrant certificates at the corporate trust office of the Warrant Agentdebt warrant agent or any other office indicated in the Prospectus Supplement, the Companyprospectus supplement, we will, as soon as practicable, forwarddeliver the Debt Securities purchasableamount of the underlying debt securities purchased upon such exercise. If lessfewer than all of the Debt Warrantsdebt warrants represented by suchany debt warrant certificate are exercised, a new debt warrant certificate will be issued for the remaining Debt Warrants.
unexercised debt warrants. If you hold a debt warrant, you must pay any tax or other governmental charge that may be imposed in connection with any transfer involved in the issuance of underlying debt securities purchased upon such exercise.
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LEGAL OWNERSHIP AND BOOK-ENTRY ISSUANCE
In this section, we describe special considerations that will apply to registered securities issued in global, i.e., book-entry form. First we describe the difference between legal ownership and indirect ownership of registered securities. Then we describe special provisions that apply to global securities.
WHO IS THE LEGAL OWNER OF A REGISTERED SECURITY?
Each debt security, share of common or preferred stock and depositary share in registered form will be represented either by a certificate issued in definitive form to a particular investor or by one or more global securities representing the entire issuance of securities. We refer to those who have securities registered in their own names, on the books that we or the trustee or other agent maintain for this purpose, as the “holders” of those securities. These persons are the legal holders of the securities. We refer to those who, indirectly through others, own beneficial interests in securities that are not registered in their own names as indirect owners of those securities. As we discuss below, indirect owners are not legal holders, and investors in securities issued in book-entry form or in street name will be indirect owners.
BOOK-ENTRY OWNERS
We expect to issue debt securities, shares of preferred stock and depositary shares in book-entry form only. However, we may issue shares of common stock in book-entry form. This means those securities will be represented by one or more global securities registered in the name of a financial institution that holds them as depositary on behalf of other financial institutions that participate in the depositary’s book-entry system. These participating institutions, in turn, hold beneficial interests in the securities on behalf of themselves or their customers.
Under each indenture or other applicable agreement, only the person in whose name a security is registered is recognized as the holder of that security. Consequently, for securities issued in global form, we will recognize only the depositary as the holder of the securities and we will make all payments on the securities, including deliveries of shares of common or preferred stock in exchange for exchangeable debt securities, to the depositary. The depositary passes along the payments it receives to its participants, which in turn pass the payments along to their customers who are the beneficial owners. The depositary and its participants do so under agreements they have made with one another or with their customers; they are not obligated to do so under the terms of the securities.
As a result, investors will not own securities directly. Instead, they will own beneficial interests in a global security, through a bank, broker or other financial institution that participates in the depositary’s book-entry system or holds an interest through a participant. As long as the securities are issued in global form, investors will be indirect owners, and not holders, of the securities.
STREET NAME OWNERS
In the future we may terminate a global security or issue securities initially in non-global form. In these cases, investors may choose to hold their securities in their own names or in street name. Securities held by an investor in street name would be registered in the name of a bank, broker or other financial institution that the investor chooses, and the investor would hold only a beneficial interest in those securities through an account he or she maintains at that institution.
For securities held in street name, we will recognize only the intermediary banks, brokers and other financial institutions in whose names the securities are registered as the holders of those securities and we will make all payments on those securities, including deliveries of common or preferred shares in exchange for exchangeable debt securities, to them. These institutions pass along the payments they receive to their customers who are the beneficial owners, but only because they agree to do so in their customer agreements or because they are legally required to do so. Investors who hold securities in street name will be indirect owners, not holders, of those securities.
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LEGAL HOLDERS
Our obligations, as well as the obligations of the trustee under either indenture and the obligations, if any, of any other third parties employed by us, the trustee or any agents, run only to the holders of the securities. We do not have obligations to investors who hold beneficial interests in global securities, in street name or by any other indirect means. This will be the case whether an investor chooses to be an indirect owner of a security or has no choice because we are issuing the securities only in global form.
For example, once we make a payment or give a notice to the holder, we have no further responsibility for that payment or notice even if that holder is required, under agreements with depositary participants or customers or by law, to pass it along to the indirect owners but does not do so. Similarly, if we want to obtain the approval of the holders for any purpose, e.g., to amend the indenture for a series of debt securities or to relieve us of the consequences of a default or of our obligation to comply with a particular provision of an indenture, we would seek the approval only from the holders, and not the indirect owners, of the relevant securities. Whether and how the holders contact the indirect owners is up to the holders.
When we refer to “you” in this section of the prospectus, we mean those who invest in the securities being offered by this prospectus, whether they are the holders or only indirect owners of those securities. When we refer to “your securities” in this section of the prospectus, we mean the securities in which you will hold a direct or indirect interest.
SPECIAL CONSIDERATIONS FOR INDIRECT OWNERS
If you hold securities through a bank, broker or other financial institution, either in book-entry form or in street name, you should check with your own institution to find out:
| · | how it handles securities payments and notices, |
| · | whether it imposes fees or charges, |
| · | how it would handle a request for the holders’ consent, if ever required, |
| · | whether and how you can instruct it to send you securities registered in your own name so you can be a holder, if that is permitted in the future, |
| · | how it would exercise rights under the securities if there were a default or other event triggering the need for holders to act to protect their interests, and |
| · | if the securities are in book-entry form, how the depositary’s rules and procedures will affect these matters. |
WHAT IS A GLOBAL SECURITY?
A global security is issued in book-entry form only. Each security issued in book-entry form will be represented by a global security that we deposit with and register in the name of one or more financial institutions or clearing systems, or their nominees, which we select. A financial institution or clearing system that we select for any security for this purpose is called the “depositary” for that security. A security will usually have only one depositary but it may have more.
Each series of these securities will have one or more of the following as the depositaries:
| · | The Depository Trust Company, New York, New York, which is known as “DTC,” |
| · | a financial institution holding the securities on behalf of Euroclear Bank S.A./N.V., as operator of the Euroclear system, which is known as “Euroclear,” |
| · | a financial institution holding the securities on behalf of Clearstream Banking, societe anonyme, Luxembourg, which is known as “Clearstream,” and |
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| · | any other clearing system or financial institution named in the applicable prospectus supplement. |
The depositaries named above may also be participants in each other’s systems. Thus, for example, if DTC is the depositary for a global security, investors may hold beneficial interests in that security through Euroclear or Clearstream, as DTC participants. The depositary or depositaries for your securities will be named in your prospectus supplement and if none is named, the depositary will be DTC.
A global security may represent one or any other number of individual securities. Generally, all securities represented by the same global security will have the same terms. We may, however, issue a global security that represents multiple securities of the same kind, such as debt securities, that have different terms and are issued at different times. We call this kind of global security a master global security. Your prospectus supplement will indicate whether your securities are represented by a master global security.
A global security may not be transferred to or registered in the name of anyone other than the depositary or its nominee, unless special termination situations arise. We describe those situations below under “—Holder’s Option to Obtain a Non-Global Security; Special Situations When a Global Security Will Be Terminated.” As a result of these arrangements, the depositary, or its nominee, will be the sole registered owner and holder of all securities represented by a global security, and investors will be permitted to own only indirect interests in a global security. Indirect interests must be held by means of an account with a broker, bank or other financial institution that in turn has an account with the depositary or with another institution that does. Thus, an investor whose security is represented by a global security will not be a holder of the security, but only an indirect owner of an interest in the global security.
If the prospectus supplement for a particular security indicates that the security will be issued in global form only, then the security will be represented by a global security at all times unless and until the global security is terminated. We describe the situations in which this can occur below under “—Holder’s Option to Obtain a Non-Global Security; Special Situations When a Global Security Will Be Terminated.” If termination occurs, we may issue the securities through another book-entry clearing system or decide that the securities may no longer be held through any book-entry clearing system.
SPECIAL CONSIDERATIONS FOR GLOBAL SECURITIES
As an indirect owner, an investor’s rights relating to a global security will be governed by the account rules of the depositary and those of the investor’s financial institution or other intermediary through which it holds its interest (e.g., Euroclear or Clearstream, if DTC is the depositary), as well as general laws relating to securities transfers. We do not recognize this type of investor or any intermediary as a holder of securities and instead deal only with the depositary that holds the global security.
If securities are issued only in the form of a global security, an investor should be aware of the following:
| · | an investor cannot cause the securities to be registered in his or her own name, and cannot obtain non-global certificates for his or her interest in the securities, except in the special situations we describe below, |
| · | an investor will be an indirect holder and must look to his or her own bank or broker for payments on the securities and protection of his or her legal rights relating to the securities, as we describe above under “—Who Is the Legal Owner of a Registered Security?,” |
| · | an investor may not be able to sell interests in the securities to some insurance companies and other institutions that are required by law to own their securities in non-book-entry form, |
| · | an investor may not be able to pledge his or her interest in a global security in circumstances where certificates representing the securities must be delivered to the lender or other beneficiary of the pledge in order for the pledge to be effective, |
| · | the depositary’s policies will govern payments, deliveries, transfers, exchanges, notices and other matters relating to an investor’s interest in a global security, and those policies may change from time to |
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time. We, the trustee and any agents will have no responsibility for any aspect of the depositary’s policies, actions or records of ownership interests in a global security. We, the trustee and any agents also do not supervise the depositary in any way,
| · | the depositary will require that those who purchase and sell interests in a global security within its book-entry system use immediately available funds and your broker or bank may require you to do so as well, and |
| · | financial institutions that participate in the depositary’s book-entry system and through which an investor holds its interest in the global securities, directly or indirectly, may also have their own policies affecting payments, deliveries, transfers, exchanges, notices and other matters relating to the securities, and those policies may change from time to time. For example, if you hold an interest in a global security through Euroclear or Clearstream, when DTC is the depositary, Euroclear or Clearstream, as applicable, will require those who purchase and sell interests in that security through them to use immediately available funds and comply with other policies and procedures, including deadlines for giving instructions as to transactions that are to be effected on a particular day. There may be more than one financial intermediary in the chain of ownership for an investor. We do not monitor and are not responsible for the policies or actions or records of ownership interests of any of those intermediaries. |
HOLDER’S OPTION TO OBTAIN A NON-GLOBAL SECURITY; SPECIAL SITUATIONS WHEN A GLOBAL SECURITY WILL BE TERMINATED
If we issue any series of securities in book-entry form but we choose to give the beneficial owners of that series the right to obtain non-global securities, any beneficial owner entitled to obtain non-global securities may do so by following the applicable procedures of the depositary, any transfer agent or registrar for that series and that owner’s bank, broker or other financial institution through which that owner holds its beneficial interest in the securities. For example, in the case of a global security representing shares of preferred stock or depositary shares, a beneficial owner will be entitled to obtain a non-global security representing its interest by making a written request to the transfer agent or other agent designated by us. If you are entitled to request a non-global certificate and wish to do so, you will need to allow sufficient lead-time to enable us or our agent to prepare the requested certificate.
In addition, in a few special situations described below, a global security will be terminated and interests in it will be exchanged for certificates in non-global form representing the securities it represented. After that exchange, the choice of whether to hold the securities directly or in street name will be up to the investor. Investors must consult their own banks or brokers to find out how to have their interests in a global security transferred on termination to their own names, so that they will be holders. We have described the rights of holders and street name investors above under “—Who Is the Legal Owner of a Registered Security?”
The special situations for termination of a global security are as follows:
| · | if the depositary notifies us that it is unwilling or unable to continue as depositary for that global security or the depositary has ceased to be a clearing agency registered under the Securities Exchange Act of 1934, and in either case we do not appoint another institution to act as depositary within 90 days, |
| · | in the case of a global security representing debt securities, if an event of default has occurred with regard to the debt securities and has not been cured or waived, or |
| · | any other circumstances specified for this purpose in the applicable prospectus supplement. |
If a global security is terminated, only the depositary, and not we or the trustee for any debt securities, is responsible for deciding the names of the institutions in whose names the securities represented by the global security will be registered and, therefore, who will be the holders of those securities.
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CONSIDERATIONS RELATING TO EUROCLEAR AND CLEARSTREAM
Euroclear and Clearstream are securities clearance systems in Europe. Both systems clear and settle securities transactions between their participants through electronic, book-entry delivery of securities against payment.
Euroclear and Clearstream may be depositaries for a global security. In addition, if DTC is the depositary for a global security, Euroclear and Clearstream may hold interests in the global security as participants in DTC.
As long as any global security is held by Euroclear or Clearstream, as depositary, you may hold an interest in the global security only through an organization that participates, directly or indirectly, in Euroclear or Clearstream. If Euroclear or Clearstream is the depositary for a global security and there is no depositary in the United States, you will not be able to hold interests in that global security through any securities clearance system in the United States.
Payments, deliveries, transfers, exchanges, notices and other matters relating to the securities made through Euroclear or Clearstream must comply with the rules and procedures of those systems. Those systems could change their rules and procedures at any time. We have no control over those systems or their participants and we take no responsibility for their activities. Transactions between participants in Euroclear or Clearstream, on one hand, and participants in DTC, on the other hand, when DTC is the depositary, would also be subject to DTC’s rules and procedures.
SPECIAL TIMING CONSIDERATIONS FOR TRANSACTIONS IN EUROCLEAR AND CLEARSTREAM
Investors will be able to make and receive through Euroclear and Clearstream payments, deliveries, transfers, exchanges, notices and other transactions involving any securities held through those systems only on days when those systems are open for business. Those systems may not be open for business on days when banks, brokers and other institutions are open for business in the United States.
In addition, because of time-zone differences, U.S. investors who hold their interests in the securities through these systems and wish to transfer their interests, or to receive or make a payment or delivery or exercise any other right with respect to their interests, on a particular day may find that the transaction will not be affected until the next business day in Luxembourg or Brussels, as applicable. Thus, investors who wish to exercise rights that expire on a particular day may need to act before the expiration date. In addition, investors who hold their interests through both DTC and Euroclear or Clearstream may need to make special arrangements to finance any purchases or sales of their interests between the U.S. and European clearing systems, and those transactions may settle later than would be the case for transactions within one clearing system.
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CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following summary ofdiscussion summarizes the taxation of Alexander’s, Inc. and the Company and certain
federalmaterial Federal income tax consequences to Holdersholders of the Securities iscommon stock, preferred stock, debt warrants and debt securities that are not original issue discount or zero coupon debt securities for your general information only, andonly. It is not tax advice. The summary of certain federal income
tax consequences to Holders of the Securities is based upon the opinion of
Shearman & Sterling, counsel to the Company. The tax treatment of a Holder of
Securitiesthese holders will vary depending upon the Holder'sholder’s particular situation, and this discussion addresses only Holdersholders that hold Securitiesthese securities as capital assets and does not purport to deal with all aspects of taxation that may be relevant to particular Holdersholders in light of their personal investment or -32-
35
tax circumstances, orcircumstances. This section also does not deal with all aspects of taxation that may be relevant to certain types of Holders (including dealers in
securities or currencies, banks, tax-exempt organizations, life insurance
companies, persons that hold Securities that are a hedge or that are hedged
against currency risks or that are partholders to which special provisions of a straddle or conversion
transaction) subject to special treatment under the federalFederal income tax laws.
laws apply, including:
| · | dealers in securities or currencies, |
| · | traders in securities that elect to use a mark-to-market method of accounting for their securities holdings, |
| · | banks, |
| · | tax-exempt organizations, |
| · | certain insurance companies, |
| · | persons liable for the alternative minimum tax, |
| · | persons that hold securities that are a hedge, that are hedged against interest rate or currency risks or that are part of a straddle or conversion transaction, and |
| · | U.S. shareholders or U.S. debt security holders whose functional currency is not the U.S. dollar. |
This summary is based on the Internal Revenue Code, its legislative history, existing and proposed regulations thereunder,under the Internal Revenue Code, published rulings and court decisions, alldecisions. This summary describes the provisions of these sources of law only as they are currently in effect and all subject toeffect. All of these sources of law may change at any time, perhaps with
retroactive effect.
INVESTORS ARE ADVISEDand any change in the law may apply retroactively.
WE URGE YOU TO CONSULT WITH THEIRYOUR OWN TAX ADVISORS REGARDING THE TAX CONSEQUENCES TO THEMYOU OF THE ACQUISITION, OWNERSHIPACQUIRING, OWNING AND SALESELLING SHARES OF COMMON STOCK, PREFERRED STOCK AND FIXED RATE DEBT SECURITIES, INCLUDING THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF SUCH
ACQUISITION, OWNERSHIPACQUIRING, OWNING AND SALESELLING THESE SECURITIES IN THEIRYOUR PARTICULAR CIRCUMSTANCES AND POTENTIAL CHANGES IN APPLICABLE LAWS.
TAXATION OF THE COMPANYALEXANDER’S, INC. AS A REIT
General
The Company believes that,
In the opinion of Shearman & Sterling LLP, commencing with its taxable year endingended December 31, 1995, itAlexander’s, Inc. has been organized and has operated in such a manner as
to qualifyconformity with the requirements for qualification and taxation as a REIT under Sections 856 through 860the Internal Revenue Code, and Alexander’s, Inc.’s proposed method of operation will enable it to continue to meet the requirements for qualification and taxation as a REIT under the Internal Revenue Code. Investors should be aware, however, that opinions of counsel are not binding upon the IRS or any court.
In providing its opinion, Shearman & Sterling LLP is relying, as to certain factual matters, upon the statements and representations contained in certificates provided to Shearman & Sterling LLP by Alexander’s, Inc.
Alexander’s, Inc.’s qualification as a REIT will depend upon the continuing satisfaction by Alexander’s, Inc. of the Code.
The Companyrequirements of the Internal Revenue Code relating to qualification for REIT status. Some of these requirements depend upon actual operating results, distribution levels, diversity of stock ownership, asset composition, source of income and record keeping. Accordingly, while Alexander’s, Inc. intends to continue to qualify to be taxed as a REIT, but no
assurancethe actual results of continuedAlexander’s, Inc.’s operations for any particular year might not
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satisfy these requirements. Shearman & Sterling LLP will not monitor the compliance of Alexander’s, Inc. with the requirements for REIT qualification can be given.
on an ongoing basis.
The sections of the Internal Revenue Code applicable to REITs are highly technical and complex. The following discussion summarizes material aspects thereof are summarized below.
of these sections of the Internal Revenue Code.
As a REIT, the CompanyAlexander’s, Inc. generally will not be subjecthave to federalpay Federal corporate income taxes on its net income that isit currently distributeddistributes to stockholders. This treatment substantially eliminates the "double taxation" (at“double taxation” at the corporate and stockholder levels)levels that generally results from investment in a regular corporation.
However, the CompanyAlexander’s, Inc. will be subjecthave to federalpay Federal income tax as follows. First, the Companyfollows:
| · | First, Alexander’s, Inc. will |
| · | Second, under certain circumstances, Alexander’s, Inc. may have to pay the alternative minimum tax on its items of tax preference. |
| · | Third, if Alexander’s, Inc. has (a) net income from the sale or other disposition of “foreclosure property,” as defined in the Internal Revenue Code, which is held primarily for sale to customers in the ordinary course of business, or (b) other non-qualifying income from foreclosure property, it will have to pay tax at the highest corporate rate on that income. |
| · | Fourth, if Alexander’s, Inc. has net income from “prohibited transactions,” as defined in the Internal Revenue Code, Alexander’s, Inc. will have to pay a 100% tax on that income. Prohibited transactions are, in general, certain sales or other dispositions of property, other than foreclosure property, held primarily for sale to customers in the ordinary course of business. |
| · | Fifth, if Alexander’s, Inc. fails to satisfy the 75% gross income test or the 95% gross income test, as discussed below under “—Requirements for Qualification—Income Tests,” but has nonetheless maintained its qualification as a REIT because Alexander’s, Inc. has satisfied some other requirements, it will have to pay a 100% tax on an amount equal to (a) the gross income attributable to the greater of (i) 75% of Alexander’s, Inc.’s gross income over the amount of gross income that is qualifying income for purposes of the 75% test, and (ii) 90% of Alexander’s, Inc.’s gross income (95% for taxable years ending before January 1, 2001) over the amount of gross income that is qualifying income for purposes of the 95% test, multiplied by (b) a fraction intended to reflect Alexander’s, Inc.’s profitability. |
| · | Sixth, if Alexander’s, Inc. fails to distribute during each calendar year at least the sum of (1) 85% of its REIT ordinary income for that year, (2) 95% of its REIT capital gain net income for that year and (3) any undistributed taxable income from prior periods, Alexander’s, Inc. would have to pay a 4% excise tax on the excess of that required distribution over the amounts actually distributed. |
| · | Seventh, if Alexander’s, Inc. acquires any asset from a C corporation in certain transactions in which Alexander’s, Inc. must adopt the basis of the asset or any other property in the hands of the C corporation as the basis of the asset in the hands of Alexander’s, Inc., and Alexander’s, Inc. recognizes gain on the disposition of that asset during the 10-year period beginning on the date on which Alexander’s, Inc. acquired that asset, then Alexander’s, Inc. will have to pay tax on the built-in gain at the highest regular corporate rate. A C corporation means generally a corporation that has to pay full corporate-level tax. |
| · | Eighth, if Alexander’s, Inc. receives non-arm’s length income from a taxable REIT subsidiary (as defined under “—Requirements for Qualification—Asset Tests”), or as a result of services provided by a taxable REIT subsidiary to tenants of Alexander’s, Inc., Alexander’s, Inc. will be subject to a 100% tax on the amount of Alexander’s, Inc.’s non-arm’s length income. |
| · | Ninth, if Alexander’s, Inc. fails to satisfy a REIT asset test, as described below, due to reasonable cause and Alexander’s, Inc. nonetheless maintains its REIT qualification because of specified cure provisions, |
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Alexander’s, Inc. will generally be required to pay a tax equal to the greater of $50,000 or the amount by which the
Company fails the 75% or 95% test,highest corporate tax rate multiplied by (b) a fraction intended to
reflect the Company's profitability. Sixth, if the Company should fail to
distribute during each calendar year at least the sum of (i) 85% of its real
estate investment trust ordinary income for such year, (ii) 95% of its real
estate investment trust capital gain net income forgenerated by the nonqualifying assets that caused Alexander’s, Inc. to fail such year, and (iii) any
undistributedtest.
| · | Tenth, if Alexander’s, Inc. fails to satisfy any provision of the Code that would result in its failure to qualify as a REIT (other than a violation of the REIT gross income tests or a violation of the asset tests described below) and the violation is due to reasonable cause, Alexander’s, Inc. may retain its REIT qualification but will be required to pay a penalty of $50,000 for each such failure. |
Alexander’s, Inc. has a net operating loss carryover as of December 31, 2007 of approximately $4,212,000. The net operating loss carryover would be available to reduce its REIT taxable income from prior periods, the Company would be subject
to a 4% excise tax on the excess of such required distribution over the amounts
actually distributed. Seventh, if during the 10-year period (the "Recognition
Period") beginning on the first day of the first taxable year for which the
Company qualified as a REIT, the Company recognizeswell as any built-in gain on the disposition of
any asset held by the Company as of the beginning of the Recognition Period,
then, to the extent of the excess of (a) fair market value of such asset as of
the beginning of the Recognition Period over (b) the Company's adjusted basis
in such asset as of the beginning of the Recognition Period (the "Built-in
Gain"), such gain will be subject to tax at the highest regular corporate rate
pursuant to Treasury regulations that have not been promulgated; provided,
however, that the Company shall not be subject to
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tax on recognized Built-in Gain with respect to assets held as of the first day
of the Recognition Period to the extent that the aggregate amount of such
recognized Built-in Gain exceeds the net aggregateit recognizes. The amount of the Company's
unrealized Built-in Gain as of the first day of the Recognition Period. Eighth,
if the Company acquires any asset from a C corporation (i.e., generally a
corporationnet operating loss carryover is subject to full corporate-level tax) in certain transactions in
which the basis of the asset in the hands of the Company is determined by
reference to the basis of the asset (or any other property) in the hands of the
C corporation,audit and the Company recognizes gain on the disposition of such asset
during the Recognition Period beginning on the date on which such asset was
acquiredadjustment by the Company, then, pursuant to the Treasury regulations that have
not yet been issued and to the extent of the Built-in Gain, such gain will be
subject to tax at the highest regular corporate rate.
Requirements for Qualification
IRS.
REQUIREMENTS FOR QUALIFICATION
The Internal Revenue Code defines a REIT as a corporation, trust or association (1)
which is managed by one or more trustees or directors, (2) the beneficial
ownership of which is evidenced by transferable shares, or by transferable
certificates of beneficial interest, (3) which would otherwise be taxable as a
domestic corporation, but for Sections 856 through 859 of the Code, (4) which
is neither a financial institution nor an insurance company subject to certain
provisions of the Code, (5) the beneficial ownership of which is held by 100 or
more persons, (6) during the last half of each taxable year, not more than 50%
in value of the outstanding stock of which is owned, directly or
constructively, by five or fewer individuals (as defined in the Code to include
certain entities) and (7) which meets certain other tests, described below,
regarding the nature of its income and assets. directors:
| · | the beneficial ownership of which is evidenced by transferable shares, or by transferable certificates of beneficial interest, |
| · | which would otherwise be taxable as a domestic corporation, but for Sections 856 through 859 of the Internal Revenue Code, |
| · | which is neither a financial institution nor an insurance company to which certain provisions of the Internal Revenue Code apply, |
| · | the beneficial ownership of which is held by 100 or more persons, |
| · | during the last half of each taxable year, not more than 50% in value of the outstanding stock of which is owned, directly or constructively, by five or fewer individuals, as defined in the Internal Revenue Code to include certain entities, and |
| · | which meets certain other tests, described below, regarding the nature of its income and assets. |
The Internal Revenue Code provides that the conditions (1) to (4)described in the first through fourth bullet points above must be met during the entire taxable year and that the condition (5)described in the fifth bullet point above must be met during at least 335 days of a taxable year of 12 months, or during a proportionate part of a taxable year of less than 12 months. Conditions (5) and (6) do not apply until after
Alexander’s, Inc. has satisfied the conditions described in the first taxable year
for which an election is made to be taxed as a REIT.
The Company has satisfied condition (5)through fifth bullet points of the preceding paragraph and believes that it also has also
satisfied the condition (6).described in the sixth bullet point of the preceding paragraph. In addition, the Company's CertificateAlexander’s, Inc.’s certificate of Incorporationincorporation provides for restrictions regarding the ownership and transfer of the Company's shares, whichAlexander’s, Inc.’s shares. These restrictions are intended to assist the CompanyAlexander’s, Inc. in continuing to satisfy the share ownership requirements described in (5)the fifth and (6)
above.sixth bullet points of the preceding paragraph. The ownership and transfer restrictions pertaining to the Common Stockcommon stock are described abovein this prospectus under the headings "Description of Capital
Stock--Description of Preferred Stock--Restrictions on Ownership" and
"Description of Capital Stock--Descriptionheading “Description of Common Stock-RestrictionsStock—Restrictions on Ownership."
The CompanyOwnership of Common Stock.”
Alexander’s, Inc. owns and operates a number of properties through
wholly-owned corporate subsidiaries. Internal Revenue Code Section 856(i) provides that unless a REIT makes an election to treat the corporation as a taxable REIT subsidiary, a corporation which is a "qualified“qualified REIT subsidiary" shallsubsidiary,” as defined in the Internal Revenue Code, will not be treated as a separate corporation, and all assets, liabilities and items of income, deduction and credit of a "qualifiedqualified REIT subsidiary" shallsubsidiary will be treated as assets, liabilities and such items (as the case may be)of these kinds of the REIT. Thus, in applying the requirements described herein, the Company's "qualifiedin this section, Alexander’s, Inc.’s qualified REIT subsidiaries"subsidiaries will be ignored, and all assets, liabilities and items of income, deduction and credit of suchthese subsidiaries will be treated as assets, liabilities and such
items (as the case may be) of the Company. The Companythese kinds of Alexander’s, Inc. Alexander’s, Inc. believes that all of its wholly-owned corporate subsidiaries are "qualifiedqualified REIT subsidiaries."
In the casesubsidiaries, except 59th Street Corporation, 731 Residential Holding LLC,
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Alexander’s of Brooklyn II LLC, Kings Plaza Lender LLC, SMB Tenant Services, SMB Tenant Services Floaters LLC, SMB Holding LLC, Vornado Office Inc. and Rego Park Residential LLC, which are taxable REIT subsidiaries.
If a REIT that is a partner in a partnership, Treasury regulations provide that the REIT will be deemed to own its proportionate share of the assets of the partnership and will be deemed to be entitled to the income of the partnership attributable to suchthat share. In addition, the character of the assets and gross income of the partnership will retain the same character in the hands of the REIT for purposes of Section 856 of the Internal Revenue Code, including satisfying the gross income tests and the asset tests. Thus, the Company'sAlexander’s, Inc.’s proportionate share of the assets, liabilities and items of income of any partnership in which the CompanyAlexander’s, Inc. is a partner will be treated as assets, liabilities and items of income of the CompanyAlexander’s, Inc. for purposes of applying the requirements described herein.
in this section. Thus, actions taken by partnerships in which Alexander’s, Inc. owns an interest, either directly or through one or more tiers of partnerships or qualified REIT subsidiaries, can affect Alexander’s, Inc.’s ability to satisfy the REIT income and assets tests and the determination of whether Alexander’s, Inc. has net income from prohibited transactions. See the fourth bullet point under “—Taxation of Alexander’s, Inc. as a REIT” above for a discussion of prohibited transactions. Alexander’s, Inc. is not currently a partner in a partnership.
Taxable REIT Subsidiaries. A taxable REIT subsidiary is any corporation in which a REIT directly or indirectly owns stock, provided that the REIT and that corporation make a joint election to treat that corporation as a taxable REIT subsidiary. The election can be revoked at any time as long as the REIT and the taxable REIT subsidiary revoke such election jointly. In addition, if a taxable REIT subsidiary holds, directly or indirectly, more than 35% of the securities of any other corporation other than a REIT (by vote or by value), then that other corporation is also treated as a taxable REIT subsidiary. A corporation can be a taxable REIT subsidiary with respect to more than one REIT.
A taxable REIT subsidiary is subject to Federal income tax at regular corporate rates (currently a maximum rate of 35%), and may also be subject to state and local taxation. Any dividends paid or deemed paid by any one of Alexander’s, Inc.’s taxable REIT subsidiaries will also be taxable, either (1) to Alexander’s, Inc. to the extent the dividend is retained by Alexander’s, Inc., or (2) to Alexander’s, Inc.’s shareholders to the extent the dividends received from the taxable REIT subsidiary are paid to Alexander’s, Inc.’s shareholders. Alexander’s, Inc. may hold more than 10% of the stock of a taxable REIT subsidiary without jeopardizing its qualification as a REIT notwithstanding the rule described below under “—Asset Tests” that generally precludes ownership of more than 10% of any issuer’s securities. However, as noted below, in order for Alexander’s, Inc. to qualify as a REIT, the securities of all of the taxable REIT subsidiaries in which it has invested either directly or indirectly may not represent more than 20% (25% for taxable years beginning on or after January 1, 2009) of the total value of its assets. Alexander’s, Inc. expects that the aggregate value of all of its interests in taxable REIT subsidiaries will represent less than 20% of the total value of its assets; however, Alexander’s, Inc. cannot assure that this will always be true. Other than certain activities related to operating or managing a lodging or health care facility as more fully described below under “—Income Tests.Tests,” a taxable REIT subsidiary may generally engage in any business including the provision of customary or non-customary services to tenants of the parent REIT.
INCOME TESTS. In order to maintain its qualification as a REIT, the
CompanyAlexander’s, Inc. annually must satisfy threetwo gross income requirements. First, at least
75% of the Company's gross income (excluding gross income from prohibited
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37
transactions) for each taxable year must be derived directly or indirectly from
investments relating to real property or mortgages on real property (including
"rents from real property"--which term generally includes expenses of the
Company
| · | First, Alexander’s, Inc. must derive at least 75% of its gross income, excluding gross income from prohibited transactions, for each taxable year directly or indirectly from investments relating to real property or mortgages on real property, including “rents from real property,” as defined in the Internal Revenue Code, or from certain types of temporary investments. Rents from real property generally include expenses of Alexander’s, Inc. that are paid or reimbursed by tenants. |
| · | Second, at least 95% of Alexander’s, Inc.’s gross income, excluding gross income from prohibited transactions, for each taxable year must be derived from real property investments as described in the preceding bullet point, dividends, interest and gain from the sale or disposition of stock or securities, or from any combination of these types of source. |
47
Rents that are paid or reimbursed by tenants--and, in certain circumstances,
interest) or from certain types of temporary investments. Second, at least 95%
of the Company's gross income (excluding gross income from prohibited
transactions) for each taxable year must be derived from such real property
investments, dividends, interest and gain from the sale or disposition of stock
or securities (or from any combination of the foregoing). Third, short-term
gain from the sale or other disposition of stock or securities, gain from
prohibited transactions and gain on the sale or other disposition of real
property held for less than four years (apart from involuntary conversions and
sales of foreclosure property) must represent less than 30% of the Company's
gross income (including gross income from prohibited transactions) for each
taxable year.
Rents received by the CompanyAlexander’s, Inc. receives will qualify as "rentsrents from real property"property in satisfying the gross income requirements for a REIT described above only if the rents satisfy several conditions are met. First, the amount of rent must not be
based in whole or in part on the income or profits of any person. However, an
amount received or accrued generally will not be excluded from the terms "rents
from real property" solely by reason of being based on a fixed percentage or
percentages of receipts or sales. Second, the Code provides that rents received
from a tenant will not qualify as "rents from real property" in satisfying the
gross income tests if the REIT, directly or under the applicable attribution
rules, owns a 10% or greater interest in such tenant (a "Related Party
Tenant"). Third, if rent attributable to personal property leased in connection
with a lease of real property is greater than 15% of the total rent received
under the lease, then the portion of rent attributable to such personal
property will not qualify as "rents from real property". Finally, for rents
received to qualify as "rents from real property," the REIT generally must not
operate or manage the property or furnish or render services to the tenants of
such property, other than through an independent contractor from whom the REIT
derives no revenue; provided, however, that the Company is not required to use
an independent contractor to perform certain services that are "usually or
customarily rendered" in connection with the rental of space for occupancy only
and are not otherwise considered "rendered to the occupant" of the property.
The Companyconditions.
| · | First, the amount of rent must not be based in whole or in part on the income or profits of any person. However, an amount received or accrued generally will not be excluded from rents from real property solely because it is based on a fixed percentage or percentages of receipts or sales. |
| · | Second, the Internal Revenue Code provides that rents received from a tenant will not qualify as rents from real property in satisfying the gross income tests if the REIT, directly or under the applicable attribution rules, owns a 10% or greater interest in that tenant; except that for tax years beginning after December 31, 2000, rents received from a taxable REIT subsidiary under certain circumstances qualify as rents from real property even if Alexander’s, Inc. owns more than a 10% interest in the subsidiary. We refer to a tenant in which Alexander’s, Inc. owns a 10% or greater interest as a “related party tenant.” |
| · | Third, if rent attributable to personal property leased in connection with a lease of real property is greater than 15% of the total rent received under the lease, then the portion of rent attributable to the personal property will not qualify as rents from real property. |
| · | Finally, for rents received to qualify as rents from real property, the REIT generally must not operate or manage the property or furnish or render services to the tenants of the property, other than through an independent contractor from whom the REIT derives no revenue or through a taxable REIT subsidiary. However, Alexander’s, Inc. may directly perform certain services that landlords usually or customarily render when renting space for occupancy only or that are not considered rendered to the occupant of the property. |
Alexander’s, Inc. does not and will not charge rent for any property to a Related
Party Tenant, and the Companyderive significant rents from related party tenants. Alexander’s, Inc. also does not and will not derive rental income attributable to personal property, (otherother than personal property leased in connection with the lease of real property, the amount of which is less than 15% of the total rent received under the lease). The Companylease.
Alexander’s, Inc. directly performs services for some of its tenants. Alexander’s, Inc. does not believe that anythe provision of thethese services that are performed for its tenants will cause its gross income attributable to suchthese tenants to fail to be treated as "rentsrents from real property."
If Alexander’s, Inc. were to provide services to a tenant that are other than those landlords usually or customarily provide when renting space for occupancy only, amounts received or accrued by Alexander’s, Inc. for any of these services will not be treated as rents from real property for purposes of the REIT gross income tests. However, the amounts received or accrued for these services will not cause other amounts received with respect to the property to fail to be treated as rents from real property unless the amounts treated as received in respect of the services, together with amounts received for certain management services, exceed 1% of all amounts received or accrued by Alexander’s, Inc. during the taxable year with respect to the property. If the sum of the amounts received in respect of the services to tenants and management services described in the preceding sentence exceeds the 1% threshold, then all amounts received or accrued by Alexander’s, Inc. with respect to the property will not qualify as rents from real property, even if Alexander’s, Inc. provides the impermissible services to some, but not all, of the tenants of the property.
The term "interest"“interest” generally does not include any amount received or accrued, (directlydirectly or indirectly)indirectly, if the determination of suchthat amount depends in whole or in part on the income or profits of any person. However, an amount received or accrued generally will not be excluded from the term "interest"interest solely by reason of beingbecause it is based on a fixed percentage or percentages of receipts or sales.
From time to time, Alexander’s, Inc. may enter into hedging transactions with respect to one or more of its assets or liabilities. Alexander’s, Inc.’s hedging activities may include entering into interest rate swaps, caps, and floors, options to purchase these items, and futures and forward contracts. Except to the extent provided by Treasury Regulations, any income Alexander’s, Inc. derives from a hedging transaction that is clearly identified as such as specified in the Code, including gain from the sale or disposition of such a transaction, will not constitute gross income for purposes of the 75% or 95% gross income tests, and therefore will be exempt from these tests, but only to the extent that the transaction hedges indebtedness incurred or to be incurred by us to acquire or carry real estate.
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The term “hedging transaction,” as used above, generally means any transaction Alexander’s, Inc. enters into in the normal course of its business primarily to manage risk of interest rate or price changes or currency fluctuations with respect to borrowings made or to be made, or ordinary obligations incurred or to be incurred, by Alexander’s, Inc. Alexander’s, Inc. intends to structure any hedging transactions in a manner that does not jeopardize its status as a REIT.
If the CompanyAlexander’s, Inc. fails to satisfy one or both of the 75% or 95% gross income tests for any taxable year, it may nevertheless qualify as a REIT for suchthat year if it is entitled to relief under certainsatisfies the requirements of other provisions of the Code.Internal Revenue Code that allow relief from disqualification as a REIT. These relief provisions generally will generally be available if the Company's failure to
meet suchif:
| · | Alexander’s, Inc.’s failure to meet the income tests was due to reasonable cause and not due to willful neglect; and |
| · | Alexander’s, Inc. files a schedule of each item of income in excess of the limitations described above in accordance with regulations to be prescribed by the IRS |
Alexander’s, Inc. might not due to willful neglect, the
Company attaches a schedule of the sources of its income to its federal income
tax return, and any incorrect information on the schedule was not due to fraud
with intent to evade tax. It is not possible, however, to state whether in all
circumstances the Company would be entitled to the benefit of these relief provisions.provisions, however. As discussed abovein the fifth bullet point under "-- General,"“—Taxation of Alexander’s, Inc. as a REIT” above, even if these relief provisions apply, Alexander’s, Inc. would have to pay a tax would be imposed with respect toon the excess net income.
Asset Tests. The Company,
ASSET TESTS. Alexander’s, Inc., at the close of each quarter of its taxable year, also must also satisfy threevarious tests relating to the nature of its assets.
| · | First, at least 75% of the value of Alexander’s, Inc.’s total assets must be represented by real estate assets, including (a) real estate assets held by Alexander’s, Inc.’s qualified REIT subsidiaries, Alexander’s, Inc.’s allocable share of real estate assets held by partnerships in which Alexander’s, Inc. owns an interest and stock issued by another REIT, (b) for a period of one year from the date of Alexander’s, Inc.’s receipt of proceeds of an offering of its shares of beneficial interest or publicly offered debt with a term of at least five years, stock or debt instruments purchased with these proceeds and (c) cash, cash items and government securities. |
| · | Second, not more than 25% of Alexander’s, Inc.’s total assets may be represented by securities other than those in the 75% asset class. |
| · | Third, for taxable years beginning after December 31, 2000, but before January 1, 2009, not more than 20% (25% for taxable years beginning on or after January 1, 2009) of Alexander’s, Inc.’s total assets may constitute securities issued by taxable REIT subsidiaries and, of the investments included in the 25% asset class, the value of any one issuer’s securities, other than equity securities issued by another REIT or by a taxable REIT subsidiary, owned by Alexander’s, Inc. may not exceed 5% of the value of Alexander’s, Inc.’s total assets. Moreover, Alexander’s, Inc. may not own more than 10% of the vote or value of the outstanding securities of any one issuer, except for issuers that are REITs, qualified REIT subsidiaries or taxable REIT subsidiaries, or certain securities that qualify under a safe harbor provision of the Code (such as so-called “straight-debt” securities). Also, solely for the purposes of the 10% value test described above, the determination of Alexander’s, Inc.’s interest in the assets of any partnership or limited liability company in which it owns an interest will be based on Alexander’s, Inc.’s proportionate interest in any securities issued by the partnership or limited liability company, excluding for this purpose certain securities described in the Code. As a consequence, if the IRS successfully challenges the partnership status of any of the partnerships in which Alexander’s, Inc. maintains an interest, and the partnership is reclassified as a corporation or a publicly traded partnership taxable as a corporation Alexander’s, Inc. could lose its REIT status. |
Certain relief provisions may be available to Alexander’s, Inc. if it fails to satisfy the asset tests described above after the 30 day cure period. Under these provisions, Alexander’s, Inc. will be deemed to have met the 5% and 10% REIT asset tests if the value of its nonqualifying assets (i) does not exceed the Company'slesser of (a) 1% of the total value of its assets must be
represented by real estateat the end of the applicable quarter and (b) $10,000,000, and (ii) Alexander’s, Inc. disposes of the nonqualifying assets (including (i) real estate assets held bywithin (a) six months after the Company's qualified REIT subsidiaries andlast day of the Company's allocable share of real
estate assets held by partnershipsquarter in which the Company owns an interest, (ii)
stockfailure to satisfy the asset
49
tests is discovered or debt instruments held for(b) the period of time prescribed by Treasury Regulations to be issued. For violations due to reasonable cause and not more than one year purchased withwillful neglect that are not described in the proceeds ofpreceding sentence, Alexander’s, Inc. may avoid disqualification as a stock offering or long-term (at least five years) debt offeringREIT under any of the Companyasset tests, after the 30 day cure period, by taking steps including (i) the disposition of the nonqualifying assets to meet the asset test within (a) six months after the last day of the quarter in which the failure to satisfy the asset tests is discovered or (b) the period of time prescribed by Treasury Regulations to be issued, (ii) paying a tax equal to the greater of (a) $50,000 or (b) the highest corporate tax rate multiplied by the net income generated by the nonqualifying assets, and (iii) stock issued by another REIT), cash, cash
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items and government securities. Second, not more than 25% ofdisclosing certain information to the Company's
total assets may be represented by securities other than those in the 75% asset
class. Third, of the investments included in the 25% asset class, the value of
any one issuer's securities (other than securities issued by another REIT)
owned by the Company may not exceed 5% of the value of the Company's total
assets and the Company may not own more than 10% of any one issuer's
outstanding voting securities.
Annual Distribution Requirements. The Company,IRS.
ANNUAL DISTRIBUTION REQUIREMENTS. Alexander’s, Inc., in order to qualify as a REIT, is required to distribute dividends, (otherother than capital gain dividends)dividends, to its stockholders in an amount at least equal to (A)(1) the sum of (i) 95%(a) 90% of the Company's "realAlexander’s, Inc.’s “real estate investment trust taxable income" (computedincome,” computed without regard to the dividends paid deduction and the Company'sAlexander’s, Inc.’s net capital gain)gain, and (ii) 95%(b) 90% of the net after-tax income, (after tax), if any, from foreclosure property minus (B)(2) the sum of certain items of non-cash income.
For taxable years beginning before January 1, 2001, the required amount of distributions described above and below was 95% of the amount of Alexander’s, Inc.’s income or gain, as the case may be.
In addition, if the CompanyAlexander’s, Inc. disposes of any asset during its Recognition Period, the Companywithin 10 years of acquiring it, Alexander’s, Inc. will be required pursuant to Treasury regulations which have not yet been promulgated, to distribute at least 95%90% of the Built-in Gain (after tax),after-tax built-in gain, if any, recognized on the disposition of such asset. Suchthe asset after taking into account net operating loss carryovers and capital loss carryovers.
These distributions must be paid in the taxable year to which they relate, or in the following taxable year if declared before the CompanyAlexander’s, Inc. timely files its tax return for suchthe year to which they relate and if paid on or before the first regular dividend payment after suchthe declaration.
To the extent that the CompanyAlexander’s, Inc. does not distribute all of its net capital gain or distributes at least 95%90%, but less than 100%, of its "realreal estate investment trust taxable income," as adjusted, it will be subjecthave to pay tax thereonon those amounts at regular ordinary and capital gain corporate tax rates. Furthermore, if the Company should failAlexander’s, Inc. fails to distribute during each calendar year at least the sum of (i)(a) 85% of its ordinary income for suchthat year, (ii)(b) 95% of its capital gain net income for suchthat year and (iii)(c) any undistributed taxable income from prior periods, the
CompanyAlexander’s, Inc. would be subjecthave to pay a 4% excise tax on the excess of suchthe required distribution over the amounts actually distributed. The Company
Alexander’s, Inc. intends to satisfy the annual distribution requirements.
As of December 31, 1994, the Company had reported net operating loss
("NOL") carryovers aggregating approximately $110 million. These NOL
carryovers expire in 2005, 2006, 2007, 2008 and 2009. Under the Code, the
Company's NOL carryovers generally would be available
From time to offset the amount of
the Company's "real estate investment trust taxable income" that otherwise
would be required to be distributed to its stockholders. As a result, until
the NOL carryovers are utilized, the Company does not expect to be required to
pay dividends (except with respect to any recognized Built-In Gain) in order
to continue to qualify as a REIT. However, the NOLs reported on the Company's
tax returns are not binding on the Internal Revenue Service (the "IRS") and
are subject to adjustment as a result of future IRS audits of the Company's
tax returns. In addition, under Section 382 of the Code, the Company's ability
to use its NOL carryovers could be limited if, generally, there were
significant changes in the ownership of its outstanding stock.
If the Company is required to make a distribution to its stockholders,
it is possible that the Companytime, Alexander’s, Inc. may not have sufficient cash or other liquid assets to meet the 95%90% distribution requirementsrequirement due to various circumstances,
including debt amortization requirements or timing differences between (i) the
actual receipt of(a) when Alexander’s, Inc. actually receives income and actual payment ofwhen it actually pays deductible expenses and (ii)(b) when Alexander’s, Inc. includes the
inclusion of such income and deduction of suchdeducts the expenses in arriving at its taxable incomeincome. If timing differences of the Company. In the event that such insufficiency occurs,this kind occur, in order to meet the 95%90% distribution requirements, the Companyrequirement, Alexander’s, Inc. may find it necessary to arrange for short-term, or possibly long-term, borrowings or to pay dividends in the form of taxable stock dividends or subordinated notes.
dividends.
Under certain circumstances, the CompanyAlexander’s, Inc. may be able to rectify a failure to meet the distribution requirement for a year by paying "deficiency
dividends"“deficiency dividends” to stockholders in a later year, which may be included in the
Company'sAlexander’s, Inc.’s deduction for dividends paid for the earlier year. Thus, the CompanyAlexander’s, Inc. may be able to avoid being taxed on amounts distributed as deficiency dividends; however, the CompanyAlexander’s, Inc. will be required to pay interest based upon the amount of any deduction taken for deficiency dividends.
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Failure to Qualify
FAILURE TO QUALIFY AS A REIT
If the CompanyAlexander’s, Inc. fails to qualify for taxation as a REIT in any taxable year, and the relief provisions do not apply, the CompanyAlexander’s, Inc. will be subjecthave to pay tax, (includingincluding any applicable alternative minimum tax)tax, on its taxable income at regular corporate rates. DistributionsAlexander’s, Inc. will not be able to deduct distributions to stockholders in any year in which the
Companyit fails to qualify, will not be deductible by the Company nor will theyAlexander’s, Inc. be required to be made.make distributions to stockholders. In suchthis event, to the extent of current and accumulated earnings and profits, all distributions to stockholders will be taxable to the stockholders as ordinarydividend income and,(which may be subject to certain limitations of the Code,tax at preferential rates) and corporate distributees may be eligible for the dividends received deduction.deduction if they satisfy the relevant provisions of the Internal Revenue
50
Code. Unless entitled to relief under specific statutory provisions, the CompanyAlexander’s, Inc. also will also be disqualified from taxation as a REIT for the four taxable years following the year during which qualification was lost. It isAlexander’s, Inc. might not possible to state
whether in all circumstances the Company would be entitled to suchthe statutory relief.
TAXATION OF HOLDERS OF DEBT SECURITIES
As used herein, the term "U.S. Holder" means a holder of a Debt
Security who (for United States federal income tax purposes) is (i) a citizen
or resident of the United States, (ii) a domestic corporation or (iii)
otherwise subject to United States federal income taxation on a net income
basis in respect of the Debt Security and "U.S. Alien Holder" means a holder of
a Debt Security who (for United States federal income tax purposes) is (i) a
nonresident alien individual or (ii) a foreign corporation, partnership or
estate or trust which is not subject to United States federal income tax on a
net income basis in respect of income or gain from the Debt Security.
U.S. Holders
Payments of Interest. Interest on a Debt Security will be taxable to
a U.S. Holder as ordinary income at the time it is received or accrued,
depending on the holder's method of accounting for tax purposes.
Purchase, Sale and Retirement of the Debt Securities. A U.S. Holder's
tax basis in a Debt Security will generally be its U.S. dollar cost (including,
in the case of a Debt Security acquired through the exercise of a Debt Warrant,
both the cost of the Debt Warrant and the amount paid on exercise of the Debt
Warrant). A U.S. Holder will generally recognize gain or loss on the sale or
retirement of a Debt Security equal to the difference between the amount
realized on the sale or retirement and the U.S. Holder's tax basis in the Debt
Security. Except to the extent attributable to accrued but unpaid interest,
gain or loss recognized on the sale or retirement of a Debt Security will be
capital gain or loss and will be long-term capital gain or loss if the Debt
Security was held for more than one year.
U.S. Alien Holders
This discussion assumes that the Debt Security is not subject to the
rules of Section 871(h)(4)(A) of the Code (relating to interest payments that
are determined by reference to the income, profits, changes in the value of
property or other attributes of the debtor or a related party).
Under present United States federal income and estate tax law, and
subject to the discussion of backup withholding below:
(i) payments of principal, premium (if any) and interest by the
Company or any of its paying agents to any holder of a Debt Security that is a
U.S. Alien Holder will not be subject to United States federal withholding tax
if, in the case of interest (a) the beneficial owner of the Debt Security does
not actually or constructively own 10% or more of the total combined voting
power of all classes of stock of the Company entitled to vote, (b) the
beneficial owner of the Debt Security is not a controlled foreign corporation
that is related to the Company through stock ownership, and (c) either (A) the
beneficial owner of the Debt Security certifies to the Company or its agent,
under penalties of perjury, that it is not a U.S. person and provides its name
and address or (B) a securities clearing
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organization, bank or other financial institution that holds customers'
securities in the ordinary course of its trade or business (a "financial
institution") and holds the Debt Security certifies to the Company or its agent
under penalties of perjury that such statement has been received from the
beneficial owner by it or by a financial institution between it and the
beneficial owner and furnishes the payor with a copy thereof;
(ii) a U.S. Alien Holder of a Debt Security will not be subject to
United States federal withholding tax on any gain realized on the sale or
exchange of a Debt Security; and
(iii) a Debt Security held by an individual who at death is not a
citizen or resident of the United States will not be includible in the
individual's gross estate for purposes of the United States federal estate tax
as a result of the individual's death if (a) the individual did not actually or
constructively own 10% or more of the total combined voting power of all
classes of stock of the Company entitled to vote and (b) the income on the Debt
Security would not have been effectively connected with a United States trade
or business of the individual at the time of the individual's death.
Information Reporting and Backup Withholding
U.S. Holders. In general, information reporting requirements will
apply to payments of principal, any premium and interest on a Debt Security and
the proceeds of the sale of a Debt Security before maturity within the United
States to non-corporate U.S. Holders, and "backup withholding" at a rate of 31%
will apply to such payments if the U.S. Holder fails to provide an accurate
taxpayer identification number or to report all interest and dividends required
to be shown on its federal income tax returns.
U.S. Alien Holders. Information reporting and backup withholding will
not apply to payments of principal, premium (if any) and interest made by the
Company or a paying agent to a U.S. Alien Holder on a Debt Security if the
certificationrelief described in clause (i)(c) under "U.S. Alien Holders" above is
received, provided that the payor does not have actual knowledge that the
holder is a U.S. person.
Payments of the proceeds from the sale by a U.S. Alien Holder of a
Debt Security made to or through a foreign office of a broker will not be
subject to information reporting or backup withholding, except that if the
broker is a U.S. person, a controlled foreign corporation for United States
federal income tax purposes or a foreign person 50% or more of whose gross
income is effectively connected with a United States trade or business for a
specified three-year period, information reporting may apply to such payments.
Payments of the proceeds from the sale of a Debt Security to or through the
United States office of a broker is subject to information reporting and backup
withholding unless the holder or beneficial owner certifies as to its
non-United States status or otherwise establishes an exemption from information
reporting and backup withholding.
The applicable Prospectus Supplement will contain a discussion of any
special United States federal income tax rules with respect to Debt Securities
that are issued at a discount or premium or as a unit with other Securities,
have a maturity of one year or less, provide for conversion rights, contingent
payments, early redemption or payments that are denominatedthis paragraph in or determined by
reference to a currency other than the U.S. dollar or otherwise subject to
special United States federal income tax rules.
TAXATION OF HOLDERS OF DEBT WARRANTS
Sale or Expiration
Generally, a holder of a Debt Warrant will recognize gain or loss upon
the sale or other disposition of a Debt Warrant in an amount equal to the
difference between the amount realized on such sale or other disposition and
the holder's tax basis in the Debt Warrant. A holder of a Debt Warrant that
expires unexercised will generally recognize loss in an amount equal to such
holder's tax basis in the Debt Warrant. Gain or loss resulting from the
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sale, other disposition or expiration of a Debt Warrant will generally be
capital gain or loss and will be long-term if the Debt Warrant was held for
more than one year.
Exercise
The exercise of a Debt Warrant with cash will not be a taxable event
for the exercising holder. Such holder's basis in the Debt Securities received
on exercise of the Debt Warrant will equal the sum of such holder's tax basis
in the exercised Debt Warrant and the exercise price of the Debt Warrant. The
holding period in a Debt Security received on exercise of a Debt Warrant will
not include the period during which the Debt Warrant was held.
The applicable Prospectus Supplement will contain a discussion of any
special United States federal income tax rules with respect to Debt Warrants
that are issued as a unit with other Securities.
all circumstances.
TAXATION OF HOLDERS OF COMMON STOCK OR PREFERRED STOCK
U.S. Stockholders
STOCKHOLDERS
As used herein,in this section, the term "U.S. Stockholder"“U.S. stockholder” means a holder of Common
Stockcommon stock or Preferred Stock ("Stock")preferred stock who, (forfor United States federalFederal income tax purposes)purposes, is (i) a citizen or resident of the United States, (ii) a
corporation, partnership or other entity created or organized in or under the
laws of the United States or of any political subdivision thereof, or (iii) an
estate or trust the income of which is subject to United States federal income
taxation regardless of its source.
| · | a citizen or resident of the United States; |
| · | a domestic corporation; |
| · | an estate whose income is subject to United States Federal income taxation regardless of its source; or |
| · | a trust if a United States court can exercise primary supervision over the trust’s administration and one or more United States persons have authority to control all substantial decisions of the trust. |
As long as the CompanyAlexander’s, Inc. qualifies as a REIT, distributions made by the
CompanyAlexander’s, Inc. out of its current or accumulated earnings and profits, (andand not designated as capital gain dividends)dividends, will constitute dividends taxable to its taxable U.S. Stockholdersstockholders as ordinary income. Such distributionsIndividual U.S. shareholders will generally not be entitled to the lower tax rate applicable to certain types of dividends except with respect to the portion of any distribution (a) that represents income from dividends Alexander’s, Inc. received from a corporation in which it owns shares (but only if such dividends would be eligible for the lower rate on dividends if paid by the corporation to its individual shareholders), or (b) that is equal to Alexander’s, Inc.’s real estate investment trust taxable income (taking into account the dividends paid deduction available to Alexander’s, Inc.) for Alexander’s, Inc.’s previous taxable year and less any taxes paid by Alexander’s, Inc. during its previous taxable year, provided that certain holding period and other requirements are satisfied at both the REIT and individual shareholder level. Individual U.S. stockholders should consult their own tax advisors to determine the impact of this new legislation. Distributions of this kind will not be eligible for the dividends-receiveddividends received deduction in the case of U.S. Stockholdersstockholders that are corporations. Distributions made by the CompanyAlexander’s, Inc. that areAlexander’s, Inc. properly designated by the Companydesignates as capital gain dividends will be taxable to U.S. Stockholdersstockholders as long-termgain from the sale of a capital gains (toasset held for more than one year, to the extent that they do not exceed the Company'sAlexander’s, Inc.’s actual net capital gain for the taxable year)year, without regard to the period for which a U.S. Stockholderstockholder has held his shares. Thus, with certain limitations, capital gain dividends received by an individual U.S. Stockholdersstockholder may be eligible for preferential rates of taxation. U.S. stockholders that are corporations may, however, be required to treat up to 20% of certain capital gain dividends as ordinary income.
To the extent that the CompanyAlexander’s, Inc. makes distributions, (notnot designated as capital gain dividends)dividends, in excess of its current and accumulated earnings and profits, suchthese distributions will be treated first as a tax-free return of capital to each U.S. Stockholder, reducingshareholder. Thus, these distributions will reduce the adjusted basis which suchthat the U.S. Stockholdershareholder has in his or her shares for tax purposes by the amount of suchthe distribution, (butbut not below zero), with distributionszero. Distributions in excess of a U.S. Stockholder'sshareholder’s adjusted basis in his shares will be taxable as capital gains, (providedprovided that the shares have been held as a capital asset).asset. For purposes of determining the portion of distributions on separate classes of Stockshares that will be treated as a dividends for federalFederal income tax purposes, current and accumulated earnings and profits will be allocated to distributions resulting from priority rights of Preferred Stockpreferred shares before being allocated to other distributions.
Dividends declaredauthorized by the CompanyAlexander’s, Inc. in October, November, or December of any year and payable to a stockholder of record on a specified date in any such month
shallof these months will be treated as both paid by the CompanyAlexander’s, Inc. and received by the stockholder on December 31 of suchthat year, provided that Alexander’s, Inc. actually pays the dividend is actually paid by the
Company on or before January 31 of the following calendar year. Stockholders may not include in their own income tax returns any net operating losses or capital losses of Alexander’s, Inc.
U.S. stockholders holding shares at the Company.
close of Alexander’s, Inc.’s taxable year will be required to include, in computing their long-term capital gains for the taxable year in which the last day of Alexander’s, Inc.’s taxable
51
year falls, the amount that Alexander’s, Inc. designates in a written notice mailed to its stockholders. Alexander’s, Inc. may not designate amounts in excess of Alexander’s, Inc.’s undistributed net capital gain for the taxable year. Each U.S. stockholder required to include the designated amount in determining the stockholder’s long-term capital gains will be deemed to have paid, in the taxable year of the inclusion, the tax paid by Alexander’s, Inc. in respect of the undistributed net capital gains. U.S. stockholders to whom these rules apply will be allowed a credit or a refund, as the case may be, for the tax they are deemed to have paid. U.S. stockholders will increase their basis in their shares by the difference between the amount of the includible gains and the tax deemed paid by the stockholder in respect of these gains.
Distributions made by the CompanyAlexander’s, Inc. and gain arising from thea U.S. stockholder’s sale or exchange by a U.S. Stockholder of shares of Stock will not be treated as passive activity income, and, asincome. As a result, U.S. Stockholdersstockholders generally will not be able to apply any "passive losses"passive losses against suchthat income or gain.
Distributions made by the Company (to the extent they do not constitute
When a return of capitalU.S. stockholder sells or capital gain dividends) generally will be treated as
investment income
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42
for purposes of computing the investment interest deduction limitation. Gain
arising from the sale or other dispositionotherwise disposes of shares, of Stock, however, will
not be treated as investment income unless the U.S. Stockholder elects to
reduce the amount of his total net capital gain eligible for the 28% maximum
capital gains rate by the amount of such gain with respect to the Stock.
Upon any sale or other disposition of shares of Stock, a U.S.
Stockholderstockholder will recognize gain or loss for federalFederal income tax purposes in an amount equal to the difference between (i)(a) the amount of cash and the fair market value of any property received on suchthe sale or other disposition, and (ii)(b) the holder'sholder’s adjusted basis in the shares of Stock for tax purposes. SuchThis gain or loss will be capital gain or loss if the shares have beenU.S. stockholder has held by the U.S. Stockholdersshares as a capital asset, andasset. The gain or loss will be long-term gain or loss if such Stockthe U.S. stockholder has been held the shares for more than one year. Long-term capital gain of an individual U.S. stockholder is generally taxed at preferential rates. In general, any loss recognized by a U.S. Stockholder uponstockholder when the salestockholder sells or other dispositionotherwise disposes of shares of Alexander’s, Inc. that the Company that have beenstockholder has held for six months or less, (afterafter applying certain holding period rules)rules, will be treated as a long-term capital loss, to the extent of distributions received by such U.S. Stockholderthe stockholder from the CompanyAlexander’s, Inc. which were required to be treated as long-term capital gains.
Backup Withholding. The Company
BACKUP WITHHOLDING. Alexander’s, Inc. will report to its U.S. Stockholdersstockholders and the Internal Revenue Service (the "IRS")IRS the amount of dividends paid during each calendar year, and the amount of tax withheld, if any. Under the backup withholdingswithholding rules, a stockholder may be subject to backup withholding at the rate of 31%may apply to a stockholder with respect to dividends paid unless suchthe holder (a) is a corporation or comes within certain other exempt categories and, when required, demonstrates this fact, or (b) provides a taxpayer identification number, certifies as to no loss of exemption from backup withholding, and otherwise complies with applicable requirements of the backup withholding rules. AThe IRS also may impose penalties on a U.S. Stockholderstockholder that does not provide the CompanyAlexander’s, Inc. with his correct taxpayer identification numbernumber. A stockholder may also be subject to penalties imposed by the IRS. Anycredit any amount paid as backup withholding will be creditable against the stockholder'sstockholder’s income tax liability. In addition, the CompanyAlexander’s, Inc. may be required to withhold a portion of capital gain distributions to any stockholders who fail to certify their non-foreign status to the Company.
Taxation of Tax-Exempt Stockholders. Generally,Alexander’s, Inc.
TAXATION OF TAX-EXEMPT STOCKHOLDERS. The IRS has ruled that amounts distributed as dividends by a REIT generally do not constitute unrelated business taxable income when received by a tax-exempt investorentity. Based on that ruling, provided that a tax-exempt stockholder is exemptnot one of the types of entity described in the next paragraph and has not held its shares as “debt financed property” within the meaning of the Internal Revenue Code, and the shares are not otherwise used in a trade or business, the dividend income from tax on its investment income, such as an individual
retirement account (IRA) or a 401(k) plan, that holds shares of Stock as an
investment will not be subjectunrelated business taxable income to a tax-exempt stockholder. Similarly, income from the sale of shares will not constitute unrelated business taxable income unless the tax-exempt stockholder has held the shares as “debt financed property” within the meaning of the Internal Revenue Code or has used the shares in a trade or business.
Income from an investment in Alexander’s, Inc.’s shares will constitute unrelated business taxable income for tax-exempt stockholders that are social clubs, voluntary employee benefit associations, supplemental unemployment benefit trusts, and qualified group legal services plans exempt from Federal income taxation under the applicable subsections of Section 501(c) of the Internal Revenue Code, unless the organization is able to properly deduct amounts set aside or placed in reserve for certain purposes so as to offset the income generated by its shares. Prospective investors of the types described in the preceding sentence should consult their own tax onadvisors concerning these “set aside” and reserve requirements.
Notwithstanding the foregoing, however, a portion of the dividends paid by the Company.
However, if such tax-exempt investor isa “pension-held REIT” will be treated as having purchased its shares
with borrowedunrelated business taxable income to any trust which:
| · | is described in Section 401(a) of the Internal Revenue Code, |
52
| · | is tax-exempt under Section 501(a) of the Internal Revenue Code, and |
| · | holds more than 10% (by value) of the equity interests in the REIT. |
Tax-exempt pension, profit-sharing and stock bonus funds somethat are described in Section 401(a) of the Internal Revenue Code are referred to below as “qualified trusts.” A REIT is a “pension-held REIT” if:
| · | it would not have qualified as a REIT but for the fact that Section 856(h)(3) of the Internal Revenue Code provides that stock owned by qualified trusts will be treated, for purposes of the “not closely held” requirement, as owned by the beneficiaries of the trust (rather than by the trust itself), and |
| · | either (a) at least one qualified trust holds more than 25% by value of the interests in the REIT or (b) one or more qualified trusts, each of which owns more than 10% by value of the interests in the REIT, hold in the aggregate more than 50% by value of the interests in the REIT. |
The percentage of any REIT dividend treated as unrelated business taxable income to a qualifying trust is equal to the ratio of (a) the gross income of the REIT from unrelated trades or allbusinesses, determined as though the REIT were a qualified trust, less direct expenses related to this gross income, to (b) the total gross income of the REIT, less direct expenses related to the total gross income. A de minimis exception applies where this percentage is less than 5% for any year. Alexander’s, Inc. does not expect to be classified as a pension-held REIT.
The rules described above under the heading “U.S. Stockholders” concerning the inclusion of Alexander’s, Inc.’s designated undistributed net capital gains in the income of its dividendsstockholders will apply to tax-exempt entities. Thus, tax-exempt entities will be subject to tax.
Non-U.S. Stockholders
allowed a credit or refund of the tax deemed paid by these entities in respect of the includible gains.
NON-U.S. STOCKHOLDERS
The rules governing United States federalU.S. Federal income taxation of the
ownership and dispositions of shares of Stock by persons that are, for purposes
of such taxation, nonresident alien individuals, foreign corporations, foreign partnerships or foreignand estates or trusts (collectively, "Non-U.S.
Stockholders")that in either case are complex, and no attemptnot subject to United States Federal income tax on a net income basis who own common stock or preferred stock, which we call “non-U.S. stockholders,” are complex. The following discussion is made herein to provide more thanonly a brieflimited summary of suchthese rules. Accordingly, the discussion does not address
all aspects of United States federal income taxation and does not address
state, local or foreign tax consequences that may be relevant to a Non-U.S.
Stockholder in light of its particular circumstances. In addition, this
discussion is based on current law, which is subject to change, and assumes
that the Company qualifies for taxation as a REIT. Prospective Non-U.S.
Stockholdersnon-U.S. stockholders should consult with their own tax advisersadvisors to determine the impact of federal,U.S. Federal, state local and foreignlocal income tax laws with regard to an investment in common stock or preferred stock, including any reporting requirements.
Distributions.
ORDINARY DIVIDENDS. Distributions, by the Company to a Non-U.S. Stockholderother than distributions that are neithertreated as attributable to gain from sales or exchanges by the CompanyAlexander’s, Inc. of United StatesU.S. real property interests, noras discussed below, and other than distributions designated by the CompanyAlexander’s, Inc. as a
capital gainsgain dividends, will be treated as dividends of ordinary income to the extent that they are made out of current or accumulated earnings and profits of Alexander’s, Inc. A withholding tax equal to 30% of the Company. Suchgross amount of the distribution will ordinarily apply to distributions ordinarily will be subjectof this kind to withholdingnon-U.S. stockholders, unless an applicable tax treaty reduces that tax. However, if income from the investment in the shares is treated as effectively connected with the non-U.S. stockholder’s conduct of a U.S. trade or business or is attributable to a permanent establishment that the non-U.S. stockholder maintains in the United States federal tax on a gross basis (thatif that is without allowance of
deductions) at a 30% rate or such lower rate as may be specifiedrequired by an applicable income tax treaty unlessas a condition for subjecting the dividends are treated as effectively
connected with the conduct by the Non-U.S. Stockholder of a United States trade
or business. Dividends that are effectively connected with such a trade or
business will be subjectnon-U.S. stockholder to taxU.S. taxation on a net income basis, (that is, after
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allowance of deductions)tax at graduated rates generally will apply to the non- U.S. stockholder in the same manner as domesticU.S. stockholders are taxed with respect to such dividends, and are generally not
subject to withholding. Any such dividends received by a Non-U.S. Stockholder
thatthe 30% branch profits tax also may apply if the stockholder is a corporation may alsoforeign corporation. Alexander’s, Inc. expects to withhold U.S. tax at the rate of 30% on the gross amount of any dividends, other than dividends treated as attributable to gain from sales or exchanges of U.S. real property interests and capital gain dividends, paid to a non-U.S. stockholder, unless (a) a lower treaty rate applies and the required form evidencing eligibility for that reduced rate is filed with Alexander’s, Inc. or the appropriate withholding agent or (b) the non-U.S. stockholder files an IRS Form W-8 ECI or a successor form with Alexander’s, Inc. or the appropriate withholding agent claiming that the distributions are effectively connected with the non-U.S. stockholder’s conduct of a U.S. trade or business and, in either case, other applicable requirements are met.
Distributions to a non-U.S. stockholder that are designated by Alexander’s, Inc. at the time of distribution as capital gain dividends which are not attributable to or treated as attributable to the disposition by Alexander’s,
53
Inc. of a U.S. real property interest generally will not be subject to an additional branch profits tax
at a 30% rate or such lower rateU.S. Federal income taxation, except as may be specified by an applicable income
tax treaty.
Pursuant to current Treasury regulations, dividends paid to an address
in a country outside the United States are generally presumed to be paid to a
resident of such country for purposes of determining the applicability of
withholding discussed above and the applicability of a tax treaty rate. Under
proposed Treasury regulations, which are not currently in effect, however, a
Non-U.S. Stockholder who wished to claim the benefit of an applicable treaty
rate would be required to satisfy certain certification and other requirements.
Under certain treaties, lower withholding rates generally applicable to
dividends do not apply to dividends from a REIT, such as the Company. Certain
certification and disclosure requirements must be satisfied to be exempt from
withholding under the effectively connected income exemption discussed above.described below.
RETURN OF CAPITAL. Distributions in excess of Alexander’s, Inc.’s current orand accumulated earnings and profits, which are not treated as attributable to the gain from Alexander’s, Inc.’s disposition of the Companya U.S. real property interest, will not be taxable to a Non-U.S. Stockholdernon-U.S. stockholder to the extent that they do not exceed the adjusted basis of the stockholder's sharesnon-U.S. stockholder’s shares. Distributions of Stock, but
ratherthis kind instead will reduce the adjusted basis of such stock.the shares. To the extent that such
distributions of this kind exceed the adjusted basis of a Non-U.S. Stockholder's stock,non-U.S. stockholder’s shares, they will give rise to tax liability if the non-U.S. stockholder otherwise would have to pay tax on any gain from the sale or exchangedisposition of his stock, the tax
treatment of which isits shares, as described below. For withholding purposes,If it cannot be determined at the Companytime a distribution is required to treat all distributions as if made outwhether the distribution will be in excess of current orand accumulated earnings and profits.profits, withholding will apply to the distribution at the rate applicable to dividends. However, the non-U.S. stockholder may seek a refund of these amounts thus withheld are generally refundablefrom the IRS if it is subsequently determined that suchthe distribution was, in fact, in excess of current or accumulated earnings and profits of the Company.Alexander’s, Inc.
CAPITAL GAIN DIVIDENDS. Distributions to a Non-U.S. Stockholder that are designated by the
Company at the time of distribution as capital gains dividends (other than
those arising from the disposition of a United States real property interest)
generally will not be subject to United States federal income taxation, unless
(i) the investment in the shares of Stock is effectively connected with the
Non-U.S. Stockholder's United States trade or business, in which case the
Non-U.S. Stockholder will be subject to the same treatment as domestic
stockholders with respect to such gain (except that a stockholder that is a
foreign corporation may also be subject to the 30% branch profits tax, as
discussed above), or (ii) the Non-U.S. Stockholder is a nonresident alien
individual who is present in the United States for 183 or more days during the
taxable year and has a "tax home" in the United States, in which case the
nonresident alien individual will be subject to a 30% tax on the individual's
capital gains.
Distributions to a Non-U.S. Stockholder that are attributable to gain from sales or exchanges by Alexander’s, Inc. of U.S. real property interests that are paid with respect to any class of stock which is regularly traded on an established securities market located in the Company of United States and held by a non-U.S. holder who does not own more than 5% of such class of stock at any time during the one year period ending on the date of distribution will be treated as a normal distribution by us, and such distributions will be taxed as described above in “—Ordinary Dividends.”
Distributions that are not described in the preceding paragraph that are attributable to gain from sales or exchanges by Alexander’s, Inc. of U.S. real property interests will cause the Non-U.S. Stockholder to be treated as recognizing such gain as
income effectively connected with a United States trade or business. Non-U.S.
Stockholders would thus generally be taxed at the same rates applicable to
domestic stockholders (subject to a special alternative minimum tax innon-U.S. stockholder under the case
of nonresident alien individuals). The Company is required to withhold 35% of
any such distribution. That amount is creditable against the Non-U.S.
Stockholder's United States federal income tax liability. Also, such
distribution may be subject to a 30% branch profits tax in the hands of a
Non-U.S. Stockholder that is a corporation, as discussed above.
Sale of Stock. Gain recognized by a Non-U.S. Stockholder upon the
sale or exchange of shares of Stock generally will not be subject to United
States taxation unless the Stock constitutes a "United States real property
interest" within the meaningprovisions of the Foreign Investment in Real Property Tax Act of 1980, ("FIRPTA").as amended. Under this statute, these distributions are taxed to a non-U.S. stockholder as if the gain were effectively connected with a U.S. business. Thus, non-U.S. stockholders will be taxed on the distributions at the normal capital gain rates applicable to U.S. stockholders, subject to any applicable alternative minimum tax and special alternative minimum tax in the case of individuals. Alexander’s, Inc. is required by applicable Treasury regulations under this statute to withhold 35% of any distribution that Alexander’s, Inc. could designate as a capital gain dividend. However, if Alexander’s, Inc. designates as a capital gain dividend a distribution made before the day Alexander’s, Inc. actually effects the designation, then although the distribution may be taxable to a non-U.S. stockholder, withholding does not apply to the distribution under this statute. Rather, Alexander’s, Inc. must effect the 35% withholding from distributions made on and after the date of the designation, until the distributions so withheld equal the amount of the prior distribution designated as a capital gain dividend. The Stocknon-U.S. stockholder may credit the amount withheld against its U.S. tax liability.
SALES OF SHARES. Gain recognized by a non-U.S. stockholder upon a sale or exchange of common stock generally will not constitute a "United States real
property interest" so long asbe taxed under the CompanyForeign Investment in Real Property Tax Act if Alexander’s, Inc. is a "domestically“domestically controlled REIT."
A "domestically controlled REIT" isREIT,” defined generally as a REIT, less than 50% in whichvalue of whose stock is and was held directly or indirectly by foreign persons at all times during a specified testing period less than 50% in value of its stockperiod. Alexander’s, Inc. believes that it is held directly
or indirectly by Non-U.S. Stockholders. Notwithstanding the foregoing, gain
fromand will continue to be a domestically controlled REIT, and, therefore, that taxation under this statute generally will not apply to the sale or exchange of StockAlexander’s, Inc. shares. However, gain to which this statute does not otherwise subject to FIRPTAapply will be taxable to a Non-U.S. Stockholder (i)non-U.S. stockholder if the investment in the Stockshares is treated as effectively connected with the Non-U.S. Stockholder'snon-U.S. stockholder’s U.S. trade or business or is attributable to a permanent establishment that the non-U.S. stockholder maintains in whichthe United States if that is required by an applicable income tax treaty as a condition for subjecting the non-U.S. stockholder to U.S. taxation on a net income basis. In this case, the Non-U.S. Stockholder will be subject to the same treatment will apply to the non-U.S. stockholder as domesticto U.S. stockholders with respect -41-
44
to suchthe gain. In addition, gain or (ii)to which the Foreign Investment in Real Property Tax Act does not apply will be taxable to a non-U.S. stockholder if the Non-U.S. Stockholdernon-U.S. stockholder is a nonresident alien individual who iswas present in the United States for 183 days or more during the taxable year and has a "tax home"“tax home” in the United States, or maintains an office or a fixed place of business in the United States to which the gain is attributable. In this case, a 30% tax will apply to the nonresident alien individualindividual’s capital gains. A similar Rule will be subjectapply to capital gain dividends to which this statute does not apply.
If Alexander’s, Inc. was not a domestically controlled REIT, tax under the Foreign Investment in Real Property Tax Act would apply to a 30% United States withholding
tax in the amount of such individual's gain.
If the Company is not or ceases to be a "domestically-controlled
REIT," whether gain arising from thenon-U.S. stockholder’s sale or exchange by a Non-U.S.
Stockholder of shares only if the selling non-U.S. stockholder
54
owned more than 5% of Stock would be subject to United States taxation under
FIRPTA asthe class of shares sold at any time during a salespecified period. This period is generally the shorter of a "United States real property interest" will depend on
whetherthe period that the non-U.S. stockholder owned the shares are "regularly traded" (as defined by applicable Treasury
regulations) on an established securities market (e.g.,sold or the New York Stock
Exchange) andfive-year period ending on the sizedate when the stockholder disposed of the selling Non-U.S. Stockholder's interest inshares. If tax under this statute applies to the
Company. If gain on the sale or exchange of shares, of Stock was subjectthe same treatment would apply to taxation under FIRPTA, the Non-U.S. Stockholder would be subjectnon-U.S. stockholder as to regular
United States income taxU.S. stockholders with respect to suchthe gain, in the same manner as a U.S.
Stockholder (subjectsubject to any applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals) and the
purchaser of the Stock would be required to withhold and remit to the IRS 10%
of the purchase price.
Backup Withholding and Information Reporting. Backup withholding tax
(which generally isindividuals.
FEDERAL ESTATE TAXES
Common stock or preferred stock held by a withholding tax imposednon-U.S. stockholder at the ratetime of 31% on certain
payments to persons that fail to furnish certain information underdeath will be included in the stockholder’s gross estate for United States information reporting requirements) and information reporting willFederal estate tax purposes, unless an applicable estate tax treaty provides otherwise.
BACKUP WITHHOLDING AND INFORMATION REPORTING
If you are a non-U.S. stockholder, you are generally not apply to distributions paid to Non-U.S. Stockholders outside the
United States that are treated as (i) dividends subject to the 30% (or lower
treaty rate) withholding tax discussed above, (ii) capital gains dividends or
(iii) distributions attributable to gainexempt from the sale or exchange by the
Company of United States real property interests. As a general matter, backup withholding and information reporting will not apply to arequirements with respect to:
| · | dividend payments, and |
| · | the payment of the proceeds from the sale of common shares effected at a United States office of a broker, |
as long as the income associated with these payments is otherwise exempt from United States Federal income tax, and:
| · | the payor or broker does not have actual knowledge or reason to know that you are a United States person and you have furnished to the payor or broker: |
| · | a valid IRS Form W-8BEN or an acceptable substitute form upon which you certify, under penalties of perjury, that you are a non-United States person, or |
| · | other documentation upon which it may rely to treat the payments as made to a non-United States person in accordance with U.S. Treasury regulations, or |
| · | you otherwise establish an exemption. |
Payment of the proceeds of afrom the sale of shares of Stock by or throughcommon stock effected at a foreign office of a foreign broker. Informationbroker generally will not be subject to information reporting (but notor backup withholding) will apply,
however, to a payment of the proceeds ofwithholding. However, a sale of Stock bycommon stock or throughpreferred stock that is effected at a foreign office of a broker will be subject to information reporting and backup withholding if:
| · | the proceeds are transferred to an account maintained by you in the United States, |
| · | the payment of proceeds or the confirmation of the sale is mailed to you at a United States address, or |
| · | the sale has some other specified connection with the United States as provided in U.S. Treasury regulations, |
unless the broker does not have actual knowledge or reason to know that you are a United States person and the documentation requirements described above are met or you otherwise establish an exemption.
In addition, a sale of common stock or preferred stock will be subject to information reporting if it is effected at a foreign office of a broker that (a) is a U.S. person, (b) derives 50% or more
of its gross income for certain periods from the conduct of a trade or business
in the United States or (c) is a "controlled foreign corporation" (generally, a
foreign corporation controlled by United States stockholders) for United States
federal income tax purposes, is:
| · | a United States person, |
| · | a controlled foreign corporation for United States tax purposes, |
55
| · | a foreign person 50% or more of whose gross income is effectively connected with the conduct of a United States trade or business for a specified three-year period, or |
| · | a foreign partnership, if at any time during its tax year: |
| · | one or more of its partners are “U.S. persons,” as defined in U.S. Treasury regulations, who in the aggregate hold more than 50% of the income or capital interest in the partnership, or |
| · | such foreign partnership is engaged in the conduct of a United States trade or business, |
unless the broker has documentary evidence in its
recordsdoes not have actual knowledge or reason to know that you are a United States person and the holder is a Non-U.S. Stockholder and certain other conditionsdocumentation requirements described above are met or the stockholderyou otherwise establishesestablish an exemption. PaymentBackup withholding will apply if the sale is subject to or
throughinformation reporting and the broker has actual knowledge that you are a United States office of a broker of the proceeds of a sale of shares
of Stock is subject to both backup withholding and information reporting unless
the stockholder certifies under penalties of perjury that the stockholder is a
Non-U.S. Stockholder, or otherwise establishes an exemption. A Non-U.S.
Stockholderperson.
You generally may obtain a refund of any amounts withheld under the backup withholding rules that exceed your income tax liability by timely filing the appropriatea refund claim for refund with the IRS.
Estate Tax. Shares of Stock owned by an individual who is not a
citizen or resident of the United States (as determined for purposes of U.S.
federal estate tax law) at the time of death will generally be includible in
such individual's gross estate for federal estate tax purposes unless an
applicable estate tax treaty provides otherwise.
OTHER TAX CONSEQUENCES
The Company
State or local taxation may apply to Alexander’s, Inc. and its stockholders may be subject to state or local
taxation in various state or local jurisdictions, including those in which it or they transact business or reside. The state and local tax treatment of the
CompanyAlexander’s, Inc. and its stockholders may not conform to the federalFederal income tax consequences discussed above. Consequently, prospective stockholders should consult their own tax advisors regarding the effect of state and local tax laws on an investment in Alexander’s, Inc.
TAXATION OF HOLDERS OF DEBT WARRANTS
SALE OR EXPIRATION
Generally, you will recognize gain or loss upon the Company.
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45
sale or other disposition of your debt warrant in an amount equal to the difference between the amount you realize on such sale or other disposition and your tax basis in the debt warrant. Your tax basis in your debt warrant generally will be its cost. If you hold a debt warrant that expires unexercised you generally will recognize loss in an amount equal to your tax basis in the debt warrant. Gain or loss resulting from the sale, other disposition or expiration of a debt warrant generally will be capital gain or loss and will be long-term if the debt warrant was held for more than one year.
EXERCISE
If you exercise your debt warrant with cash it will not be a taxable event for you. Your basis in the debt securities received on exercise of the debt warrant will equal the sum of your tax basis in the exercised debt warrant and the exercise price of the debt warrant. The holding period in a debt security received on exercise of a debt warrant will not include the period during which the debt warrant was held.
The applicable prospectus supplement will contain a discussion of any special United States Federal income tax rules with respect to debt warrants that are issued as a unit with other securities.
TAXATION OF HOLDERS OF DEBT SECURITIES
This section describes the material United States Federal income tax consequences of owning a debt security that Alexander’s, Inc. may offer for your general information only. It is not tax advice. It applies to you only if the debt security you purchase is not an original issue discount or zero coupon debt security and you acquire the debt security in the initial offering at the offering price. If you purchase a debt security at a price other than the offering price, the amortizable bond premium or market discount rules also may apply to you. You should consult your own tax advisors regarding this possibility.
56
The tax consequences of owning any debt security that is a zero coupon debt security or an original issue discount debt security, a floating rate debt security, or an indexed debt security that we offer will be discussed in the applicable prospectus supplement.
UNITED STATES DEBT SECURITY HOLDERS
This subsection describes the tax consequences to a United States holder of a debt security. You are a United States holder of a debt security if you are a beneficial owner of a debt security to which this section applies and you are:
| · | a citizen or resident of the United States, |
| · | a domestic corporation, |
| · | an estate whose income is subject to United States Federal income tax regardless of its source, or |
| · | a trust if a United States court can exercise primary supervision over the trust’s administration and one or more United States persons are authorized to control all substantial decisions of the trust. |
If you are not a United States holder of a debt security, this subsection does not apply to you and you should refer to “—United States Alien Debt Security Holders” below.
PAYMENTS OF INTEREST. You will be taxed on the interest on your debt security as ordinary income at the time you receive the interest or when it accrues, depending on your method of accounting for tax purposes.
PURCHASE, SALE AND RETIREMENT OF DEBT SECURITIES. Your tax basis in your debt security generally will be its cost (including, in the case of a debt security acquired through the exercise of a debt warrant, both the cost of the debt warrant and the amount paid on exercise of the debt warrant). You generally will recognize capital gain or loss on the sale or retirement of your debt security equal to the difference between the amount you realize on the sale or retirement, excluding any amounts attributable to accrued but unpaid interest, and your tax basis in your debt security. Capital gain of a noncorporate United States debt security holder is generally taxed at preferential rates where the holder has a holding period greater than one year.
UNITED STATES ALIEN DEBT SECURITY HOLDERS
This subsection describes the tax consequences to a United States alien debt security holder. You are a United States alien debt security holder if you are the beneficial owner of a debt security to which this section applies and are, for United States Federal income tax purposes:
| · | a nonresident alien individual, |
| · | a foreign corporation, |
| · | a foreign partnership, or |
| · | an estate or trust that in either case is not subject to United States Federal income tax on a net income basis on income or gain from a debt security. |
If you are a United States debt security holder, this subsection does not apply to you.
Under United States Federal income and estate tax law, and subject to the discussion of backup withholding below, if you are a United States alien debt security holder:
| · | we and other U.S. payors generally will not be required to deduct United States withholding tax from payments of principal and interest to you if, in the case of payments of interest: |
(1) you do not actually or constructively own 10% or more of the capital or profits interest of Alexander’s, Inc.,
57
(2) you are not a controlled foreign corporation that is related to Alexander’s, Inc. through stock ownership, and
(3) the U.S. payor does not have actual knowledge or reason to know that you are a United States person and:
(a) you have furnished to the U.S. payor an Internal Revenue Service Form W-8BEN or an acceptable substitute form upon which you certify, under penalties of perjury, that you are a non-United States person,
(b) in the case of payments made outside the United States to you at an offshore account (generally, an account maintained by you at a bank or other financial institution at any location outside the United States), you have furnished to the U.S. payor documentation that establishes your identity and your status as a non-United States person,
(c) the U.S. payor has received a withholding certificate (furnished on an appropriate IRS Form W-8 or an acceptable substitute form) from a person claiming to be:
(i) a withholding foreign partnership (generally, a foreign partnership that has entered into an agreement with the IRS to assume primary withholding responsibility with respect to distributions and guaranteed payments it makes to its partners),
(ii) a qualified intermediary (generally, a non-United States financial institution or clearing organization or a non-United States branch or office of a United States financial institution or clearing organization that is a party to a withholding agreement with the IRS), or
(iii) a U.S. branch of a non-United States bank or of a non-United States insurance company, and the withholding foreign partnership, qualified intermediary or U.S. branch has received documentation upon which it may rely to treat the payment as made to a non-United States person in accordance with U.S. Treasury regulations (or, in the case of a qualified intermediary, in accordance with its agreement with the IRS), or
(d) the U.S. payor receives a statement from a securities clearing organization, bank or other financial institution that holds customers’ securities in the ordinary course of its trade or business,
(i) certifying to the U.S. payor under penalties of perjury that an IRS Form W-8BEN or an acceptable substitute form has been received from you by it or by a similar financial institution between it and you, and
(ii) to which is attached a copy of the IRS Form W-8BEN or acceptable substitute form, or
(4) the U.S. payor otherwise possesses documentation upon which it may rely to treat the payment as made to a non-United States person in accordance with U.S. Treasury regulations, and
| · | no deduction for any United States Federal withholding tax will be made from any gain that you realize on the sale or exchange of your debt security. |
Further, a debt security held by an individual who at the individual’s time of death is not a citizen or resident of the United States will not be includible in the individual’s gross estate for United States Federal estate tax purposes if:
| · | the individual did not actually or constructively own 10% or more of the capital or profits interest of Alexander’s, Inc. at the time of the individual’s death and |
58
| · | the income on the debt security would not have been effectively connected with a United States trade or business of the individual at the time of the individual’s death. |
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, if you are a noncorporate United States debt security holder, we and other payors are required to report to the IRS all payments of principal and interest on your debt security. In addition, we and other payors are required to report to the IRS any payment of proceeds of the sale of your debt security before maturity within the United States. Additionally, backup withholding will apply to any payments if you fail to provide an accurate taxpayer identification number, or you are notified by the IRS that you have failed to report all interest and dividends required to be shown on your federal income tax returns.
In general, if you are a United States alien debt security holder, payments of principal or interest made by us and other payors to you will not be subject to backup withholding and information reporting, provided that the certification requirements described above under “—United States Alien Debt Security Holders” are satisfied or you otherwise establish an exemption. However, we and other payors are required to report payments of interest on your debt securities on IRS Form 1042-S even if the payments are not otherwise subject to information reporting requirements. In addition, payment of the proceeds from the sale of debt securities effected at a United States office of a broker will not be subject to backup withholding and information reporting provided that:
| · | the broker does not have actual knowledge or reason to know that you are a United States person and you have furnished to the broker: |
| · | an appropriate IRS Form W-8 or an acceptable substitute form upon which you certify, under penalties of perjury, that you are not a United States person, or |
| · | other documentation upon which it may rely to treat the payment as made to a non-United States person in accordance with U.S. Treasury regulations, or |
| · | you otherwise establish an exemption. |
If you fail to establish an exemption and the broker does not possess adequate documentation of your status as a non-United States person, the payments may be subject to information reporting and backup withholding. However, backup withholding will not apply with respect to payments made to an offshore account maintained by you unless the broker has actual knowledge that you are a United States person.
In general, payment of the proceeds from the sale of debt securities effected at a foreign office of a broker will not be subject to information reporting or backup withholding. However, a sale effected at a foreign office of a broker will be subject to information reporting and backup withholding if:
| · | the proceeds are transferred to an account maintained by you in the United States, |
| · | the payment of proceeds or the confirmation of the sale is mailed to you at a United States address, or |
| · | the sale has some other specified connection with the United States as provided in U.S. Treasury regulations, |
unless the broker does not have actual knowledge or reason to know that you are a United States person and the documentation requirements described above (relating to a sale of debt securities effected at a United States office of a broker) are met or you otherwise establish an exemption.
In addition, payment of the proceeds from the sale of debt securities effected at a foreign office of a broker will be subject to information reporting if the broker is:
| · | a United States person, |
| · | a controlled foreign corporation for United States tax purposes, |
59
| · | a foreign person 50% or more of whose gross income is effectively connected with the conduct of a United States trade or business for a specified three-year period, or |
| · | a foreign partnership, if at any time during its tax year: |
| · | one or more of its partners are “U.S. persons,” as defined in U.S. Treasury regulations, who in the aggregate hold more than 50% of the income or capital interest in the partnership, or |
| · | such foreign partnership is engaged in the conduct of a United States trade or business, |
unless the broker does not have actual knowledge or reason to know that you are a United States person and the documentation requirements described above (relating to a sale of debt securities effected at a United States office of a broker) are met or you otherwise establish an exemption. Backup withholding will apply if the sale is subject to information reporting and the broker has actual knowledge that you are a United States person.
You generally may obtain a refund of any amounts withheld under the backup withholding rules that exceed your income tax liability by timely filing a refund claim with the IRS.
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PLAN OF DISTRIBUTION
The Company
We may sell the Securities offered securities as follows:
| · | through agents, |
| · | to or through underwriters, or |
| · | directly to other purchasers. |
We will identify any underwriters or agents and describe their compensation in a prospectus supplement.
We, directly or through agents, may sell, and the underwriters may resell, the offered securities in one or more underwriters for
public offering and sale by them ortransactions, including negotiated transactions. These transactions may sell the Securities to investors
directly or through agents. Any such underwriter or agent involved in the offer
and sale of the Securities will be named in the related Prospectus Supplement.
The Company has reserved the right to sell the Securities directly to investors
on its own behalf in those jurisdictions where it is authorized to do so.
Underwriters may offer and sell the Securities at a fixed price or
prices that may be changed, at market prices prevailing at the time of sale, at
prices related to such prevailing market prices or at negotiated prices. The
Company also may, from time to time, authorize dealers, acting as the Company's
agents, to offer and sell the Securities upon such terms and conditions as set
forth in the related Prospectus Supplement. be:
| · | at a fixed public offering price or prices, which may be changed, |
| · | at market prices prevailing at the time of sale, |
| · | at prices related to such prevailing market prices, or |
| · | at negotiated prices. |
In connection with the sale of offered securities, the Securities, underwriters or agents may receive compensation from the Company in the form
of underwriting discountsus or commissions and may also receive commissions from purchasers of the Securities for whom they may act as agent. Underwriters may
sell the Securities to or through dealers, and such dealers may receive
compensation in the form of discounts, concession or commissions from the
underwriters and/or commissions (which may be changed from time to time) from
the purchasersoffered securities for whom they may act as agents. Any underwritingThe underwriters may sell offered securities to or through dealers, who may also receive compensation paid by the Company to underwriters or
agents in connection with the offeringfrom purchasers of the Securities, and anyoffered securities for whom they may act as agents. Compensation may be in the form of discounts, concessions or commissions allowed by underwriters to participatingcommissions. Underwriters, dealers
will be set forth in the related Prospectus Supplement. Dealers and agents participatingthat participate in the distribution of the Securitiesoffered securities may be deemed to be
underwriters as defined in the Securities Act of 1933, and any discounts andor commissions received by them from us and any profit realized by them on the resale of the Securitiesoffered securities by them may be deemed to betreated as underwriting discounts and commissions under the Securities Act. Act of 1933.
We will indemnify the underwriters and agents against certain civil liabilities, including liabilities under the Securities Act of 1933.
Underwriters, dealers and agents may be entitled, under agreements entered into with the Company, to
indemnification against and contribution towards certain civil liabilities,
including any liabilities under the Securities Act.
If so indicated in the related Prospectus Supplement, the Company will
authorize dealers acting as the Company's agents to solicit agreements by
certain institutions to purchase the Securities from the Company at the public
offering price set forth in the related Prospectus Supplement pursuant to
delayed delivery contracts ("Contracts") providing for payment and delivery on
the date or dates stated in a Prospectus Supplement. Each Contract will be for
an amount specified in the applicable Prospectus Supplement. Institutions, with
whom Contracts, when authorized, may be made include commercial and savings
banks, insurance companies, pension funds, investment companies, educational
and charitable institutions and other institutions, but will in all cases be
subject to the approval of the Company. Contracts will not be subject to any
conditions except that (i) the purchase by an institution of the Securities
covered by Contracts will not at the time of delivery be prohibited under the
laws of any jurisdiction in the United States to which such institution is
subject and (ii) if the Securities are being sold to underwriters, the Company
shall have sold to such underwriters such amount specified in the applicable
Prospectus Supplement.
Any Securities issued hereunder (other than Common Stock) will be new
issues of securities with no established trading market. Any underwriters or
agents to or through whom such Securities are sold by the Company for public
offering and sale may make a market in such Securities, but such underwriters
or agents will not be obligated to do so and may discontinue any such market
making at any time without notice. No assurance can be given as to the
liquidity of the trading market for any such Securities.
Certain of the underwriters, dealers or agents and their associates
may engage in transactions with, andor perform services for, the Company and
certain of itsus or our affiliates in the ordinary course of business.
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EXPERTS
The consolidated financial statements and the related consolidated
financial statement schedules incorporated in this Prospectus by reference from
the Company's Annual Report on Form 10-K for the year ended December 31, 1994
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their report which expresses an unqualified opinion and includes explanatory
paragraphs relating to (i) the Company's adoption of Statement of Financial
Accounting Standards No. 106 - Accounting for Postretirement Benefits and (ii)
the Company's ability to operate as a viable real estate company which depends
on the successful completion of the development and leasing of a substantial
portion of its existing properties is incorporated herein by reference, and
have been so incorporated in reliance upon the report of such firm given upon
their authority as experts in accounting and auditing.
businesses.
VALIDITY OF THE SECURITIES
The validity of the Securitiessecurities issued hereunderunder this prospectus will be passed upon for the Companyus by Shearman & Sterling LLP, New York, New York, counsel to the
Company.Alexander’s, Inc. The validity of any Securitiessecurities issued hereunderunder this prospectus will be passed upon for any underwriters by the counsel named in the applicable prospectus supplement.
EXPERTS
The consolidated financial statements as of December 31, 2007 and 2006, and for each of the three years in the period ended December 31, 2007, and the related financial statement schedules incorporated in this Prospectus Supplement.
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by reference from Alexander’s, Inc’s Annual Report on Form 10-K, and the effectiveness of Alexander’s, Inc.’s internal control over financial reporting have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports and incorporated in this Prospectus by reference, which reports (1) express an unqualified opinion on the financial statements and financial statement schedules and includes an explanatory paragraph referring to Alexander’s, Inc.’s adoption of the provisions of FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes, an Interpretation of FASB Statement No. 109.” on January 1, 2007, and (2) express an unqualified opinion on the effectiveness of internal control over financial reporting. Such consolidated financial statements and financial statement schedules have been so included in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.
61
With respect to the unaudited interim financial information for the periods ended September 30, 2008 and 2007 and June 30, 2008 and 2007 and March 31, 2008 and 2007 which is incorporated herein by reference, Deloitte & Touche LLP, an independent registered public accounting firm, have applied limited procedures in accordance with the standards of the Public Company Accounting Oversight Board (United States) for a review of such information. However, as stated in their reports included in Alexander’s, Inc.’s Quarterly Reports on Form 10-Q for the quarters ended September 30, 2008, June 30, 2008 and March 31, 2008 and incorporated by reference herein, they did not audit and they do not express an opinion on that interim financial information. Accordingly, the degree of reliance on their reports on such information should be restricted in light of the limited nature of the review procedures applied. Deloitte & Touche LLP are not subject to the liability provisions of Section 11 of the Securities Act of 1933 for their reports on the unaudited interim financial information because those reports are not "reports" or a "part" of the Registration Statement prepared or certified by an accountant within the meaning of Sections 7 and 11 of the Securities Act of 1933
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
DISTRIBUTION
The following is a statement of expenses (all of which are estimated expensesother than the SEC registration fee) in connection with the issuance and distribution of the securities being registered, other than Underwriting
Compensation, are as follows:
------------
* Estimated
underwriting compensation:
| SEC registration fee | $ | 121,350 | ||
| Printing and engraving expense | * | |||
| Legal fees and disbursements | * | |||
| Accounting fees and disbursements | * | |||
| Transfer agent’s, depositary’s and trustee’s fees and disbursements | * | |||
| Blue sky fees and expenses | * | |||
| Miscellaneous (including listing and rating agency fees) | * | |||
| Total | $ | * | ||
| * Not presently known. |
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
OFFICERS
Section 145 of the Delaware General Corporation Law empowers a corporation to indemnify its directors and officers or former directors and officers and to purchase insurance with respect to liability arising out of their capacity or status as directors and officers under certain circumstances. Such law provides further that the indemnification permitted thereunder shall not be deemed exclusive of any other rights to which the directors and officers may be entitled under a corporation's Certificatecorporation’s certificate of Incorporation, By-laws,incorporation, by-laws, agreement or otherwise.
The Company's Certificate
Alexander’s, Inc.’s certificate of Incorporationincorporation provides that the Company'sour officers and directors will be indemnified to the fullest extent permitted by Delaware law. The Companydirectors shall be liable to the Companyus or the stockholders for monetary damages for breach of the director'sdirector’s fiduciary duty. Such provision does not limit a director'sdirector’s liability to the Companyus or itsour stockholders resulting from: (i) any breach of the director'sdirector’s duty of loyalty to the Companyus or itsour stockholders, (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in sectionSection 174 of the Delaware General Corporation Law or (iv) any transaction from which the director derived an improper personal benefit.
The Company's Certificate
Alexander’s, Inc.’s certificate of Incorporationincorporation provides that the Companywe shall pay the expenses incurred by an officerour officers or a director of the Companydirectors in defending a civil or criminal action, suit, or proceeding involving such person'sperson’s acts or omissions as an officer or a director of the Companyours if such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Companyus or itsour stockholders and, with respect to a criminal action or proceeding, if the person had no reasonable cause to believe his or her conduct was unlawful. Unless ordered by a court, indemnification of an officer shall be made by the Companyus only as authorized in a specific case upon the determination that indemnification of the officer or director is proper under the circumstances because he or she has met the applicable standard of conduct. Such determination shall be made (i) by majority vote of theour directors of the Company who are not parties to the action, suit or proceeding, (ii) by independent legal counsel in a written opinion, or (iii) by the stockholdersour stockholders. Alexander’s, Inc.’s certificate of the Company. The
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Company's Certificate of Incorporationincorporation authorizes the Companyus to pay the expenses incurred by an officer or a director in defending a civil or criminal action, suit, or proceeding in advance of the final disposition thereof, upon receipt of an undertaking by or on behalf of such person to repay the expenses if it is ultimately determined that the person is not entitled to be indemnified by the Company.
The Company hasus.
We have the power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the
Company or is liable as aour director, of the Company, or is or was serving, at theour request, of the Company, as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against him and incurred by him in any such capacity or arising out of his status as such, regardless of whether the Companywe would have power to indemnify him against such liability.
The Company has
We have purchased a policy of directors'directors’ and officers'officers’ insurance that insures both the Companyus and itsour officers and directors against expenses and liabilities of the type normally insured against under such policies, including the expense of the indemnifications described above.
Pursuant to the form of Underwriting Agreement, to be filed by amendment hereto or by Form 8-K, the underwriters will agree, subject to certain conditions, to indemnify the Company,Alexander’s, Inc., its directors, certain of its officers and persons who control the CompanyAlexander’s, Inc. within the meaning of the Securities Act of 1933, as amended (the "Securities Act"“Securities Act”), against certain liabilities.
ITEM 16. EXHIBITS.
------------------------
* To be filedEXHIBITS
See the Exhibit Index which is incorporated herein by amendment or 8-K.
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4.7 Form of Depositary Receipt (included in Exhibit 4.6)
5.1* Opinion of Shearman & Sterling
12 Statement Regarding Computation of Consolidated Ratios of
Earnings to Fixed Charges
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Shearman & Sterling (included in its opinion filed
as Exhibit 5.1)
24.1 Powers of Attorney (included on signature page)
25.1* Statement of Eligibility of Senior Trustee on Form T-1
25.2* Statement of Eligibility of Subordinated Trustee on Form T-1
reference.
ITEM 17. UNDERTAKINGS.
UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment of this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation“Calculation of Registration Fee"Fee” table in the effective registration statement; and
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the registration statement is on Form S-3 or Form S-8, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
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(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
| (i) | Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and |
| (ii) | Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule |
415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
| (i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
| (iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual reportregistrant’s Annual Report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual reportplan’s Annual Report pursuant to sectionSection 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise,
(other than insurance), the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than insurance
payments and the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Alexander's,Alexander’s, Inc. certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration
Statementregistration statement on Form S-3 to be signed on its behalf by the undersigned, thereunto duly authorized, in theThe City of Saddle BrookNew York and State of New Jersey,York, on September 20, 1995.
ALEXANDER'S, INC.
By /s/ Joseph Macnow
--------------------------
Joseph Macnow
Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Joseph Macnow and Brian Kurtz, and each of them,
his true and lawful attorney-in-fact and agent, with full power of substitution
and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission any other regulatory authority, granting
unto said attorney-in-fact and agent, full power and authority to do and
perform each and every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorney-in-fact
and agent, or his substitute, may lawfully do or cause to be done by virtue
hereof.
December 23, 2008.
| ALEXANDER’S, INC. | ||
| By: | /s/ Joseph MacNow | |
| Joseph Macnow | ||
| Executive Vice President and Chief Financial Officer | ||
| (Principal Financial and Accounting Officer) | ||
Pursuant to the requirements of the Securities Act of 1933, this Registration Statementregistration statement has been signed below by the following persons in the capacities and on the date indicated.
SIGNATURE | TITLE | DATE |
| * | Chief Executive Officer | December 23, 2008 |
| Steven Roth | Board of Directors (Principal Executive Officer) | |
| * | President and Director | December 23, 2008 |
Michael D. Fascitelli | ||
/s/ Joseph Macnow | Executive Vice President Chief Financial Officer | December 23, 2008 |
Joseph Macnow | (Principal Financial and Accounting Officer) | |
| * | Director | December 23, 2008 |
Thomas R. DiBenedetto | ||
| * | Director | December 23, 2008 |
David Mandelbaum | ||
| * | Director | December 23, 2008 |
Arthur I. Sonnenblick | ||
| * | Director | December 23, 2008 |
Neil Underberg | ||
| * | Director | December 23, 2008 |
Richard West | ||
| * | Director | December 23, 2008 |
| Russell B. Wight, Jr. |
* By: /s/ JOSEPH MACNOW
Joseph Macnow
Power of Attorney
EXHIBIT INDEX
| NUMBER | DESCRIPTION |
| 1.1** | Form of Underwriting Agreement (for Common Stock) |
| 1.2** | Form of Underwriting Agreement (for Preferred Stock) |
| 1.3** | Form of Underwriting Agreement (for Debt Securities) |
| 3.1* | Amended and Restated Certificate of Incorporation of the Company |
| 3.2* | By-laws of the Company (incorporated by reference to |
| 4.1* | Specimen |
| 4.2 ** | Form of Preferred Stock Certificate of Designation |
| 4.3* | Form of Indenture for Senior Debt Securities |
| 4.4* | Form of Senior Debt Security (included in Exhibit |
| 4.5* | Form of Indenture for Subordinated Debt Securities |
| 4.6* | Form of Subordinated Debt Security (included in Exhibit |
| 4.7* | Form of Deposit Agreement |
| 4.8* | Form of Depositary Receipt (included in Exhibit |
| 4.9** | Form of Warrant Agreement |
| 4.10** | Form of Warrant (included in Exhibit 4.9) |
| 5.1 | Opinion of Shearman & Sterling |
| 8.1* | Tax Opinion of Shearman & Sterling LLP |
| 12.1* | Statement Regarding Computation of Consolidated Ratios of Earnings to Fixed Charges |
| 15.1 | Letter Regarding Unaudited Interim Financial Information |
| 23.1 | Consent of Deloitte & Touche LLP |
| 23.2* | Consent of Shearman & Sterling LLP (included in |
| 23.3* | Consent of |
| 24.1* | Power of Attorney |
| 25.1* | Statement of Eligibility of Senior Trustee on Form T-1 |
| 25.2* | Statement of Eligibility of Subordinated Trustee on Form T-1 |
| ___________ | |
| * Filed previously. | |
| ** To be filed by amendment or on a Form 8-K. | |