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2016 PROXY STATEMENT | | | | VORNADO REALTY TRUST | | | | 57 | | |
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PROPOSAL 3: APPROVAL OF AN AMENDMENT TO THE COMPANY'S DECLARATION OF TRUST TO ELIMINATE THE CLASSIFICATION OF THE COMPANY'S BOARD OF TRUSTEES
Section 2.2 of the Company's Declaration of Trust (the "Declaration") provides for the classification of the Company's Board into three classes, with the Trustees of one class being elected every year to serve until the third succeeding annual meeting and until their successors are duly elected and qualify. In March 2016, the Board deemed advisable and approved an amendment to the Declaration that would eliminate the classification of the Board over a three-year period (the "Amendment") and directed that the Amendment be submitted for consideration and to be voted upon by the Company's shareholders at this annual meeting. The text of the Amendment is attached as Annex B to this Proxy Statement.
In advance of this annual meeting, the Corporate Governance and Nominating Committee of the Board (comprised entirely of independent Trustees) as well as the full Board reviewed and reconsidered the arguments both for and against a classified board of trustees, many of which have been set forth in previous proxy statements in connection with non-binding shareholder declassification proposals, as well as other factors, including the results of the votes upon such shareholder proposals. In addition, we engaged in an extensive shareholder outreach effort to discuss governance matters, including our Board classification. Arguments for eliminating the classification of a board of trustees include that it could have the effect of increasing trustee accountability, it would give shareholders the opportunity to express their views on the performance of each trustee annually, it is responsive to our shareholders and the annual election of directors has become the norm for S&P 500 companies. Arguments against eliminating the classification of a board of trustees include that classified three-year terms for trustees can be consistent with and supportive of a company's long-term business and investment strategy and that a classified board structure can help to safeguard against coercive attempts to acquire control over a company. After careful consideration, the Corporate Governance and Nominating Committee recommended to the Board that, although there continue to be strong arguments in favor of continuing a classified board, it was advisable to amend the Declaration to eliminate the classification of the Board. The Board considered carefully the recommendation of the Corporate Governance and Nominating Committee as well as the reasons for that recommendation and determined that it was advisable to amend the Declaration to eliminate the classification of the Board.
If the Amendment is approved by the Company's shareholders, then the Company will file Articles of Amendment to the Declaration containing the amendment text set forth in Annex B to this Proxy Statement with the State Department of Assessments and Taxation of Maryland. The Amendment provides that the Trustees elected at this annual meeting will serve until the 2019 annual meeting of shareholders, the Trustees elected at the 2017 annual meeting of shareholders will serve until the 2018 annual meeting of shareholders, the Trustees elected at the 2018 annual meeting of shareholders will serve until the 2019 annual meeting of shareholders and beginning with the 2019 annual meeting of shareholders, all trustees will be elected to serve until the next annual meeting of shareholders and until their respective successors are duly elected and qualify. Accordingly, if the Amendment is approved by the Company's shareholders, then at the Company's 2019 annual meeting of shareholders, the transition to a declassified Board would be complete and, at the annual meeting of shareholders held in 2019, the entire Board would be elected to serve until the next annual meeting of shareholders and until their respective successors are duly elected and qualify.
The Board of Trustees recommends that you vote "FOR" the approval of the amendment to the Company's Declaration to eliminate the classification of the Board of Trustees.
Vote Required
The affirmative vote of shareholders of not less than a majority of the Shares outstanding and entitled to vote on this proposal, assuming a quorum is present, is required to approve the Amendment. Abstentions and broker non-votes will not be counted as votes cast and will have the effect of a vote against the Amendment.
If the Amendment is approved by the shareholders, it will become effective upon the acceptance for recording of the Articles of Amendment by the State Department of Assessments and Taxation of Maryland, which we would expect to occur promptly after the Annual Meeting. If the Amendment is not approved by the shareholders, Section 2.2 of the Declaration will remain as currently in effect and the classification of the Board will not be eliminated.
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| | 58 | | | | VORNADO REALTY TRUST | | | | 2016 PROXY STATEMENT |
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PROPOSAL 4:3: NON-BINDING, ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION The Compensation Discussion and Analysis section appearing earlier in this proxy statement describes our executive compensation program and the compensation decisions made by the Compensation Committee in or for 20152022 with respect to our Chief Executive Officer and other officers named in the Summary Compensation Table (whom we refer to as the "Named“Named Executive Officers"Officers”). In accordance with the rules and regulations of the SEC, the Board of Trustees is asking shareholders to cast avote for the following non-binding, advisory vote on the following resolution:
Advisory Resolution on Executive Compensation
Resolved:
Proposal: That the shareholders of Vornado Realty Trust (the "Company"“Company”) approve, by a non-binding, advisory resolution, the compensation of the Company'sCompany’s executive officers named in the Summary Compensation Table, as disclosed in the proxy statement for this Annual Meeting pursuant to the compensation disclosure rules of the Securities and Exchange Commission (which disclosure includes the Compensation Discussion and Analysis, the tables and the related footnotes and narrative accompanying the tables contained in our "Executive Compensation"“Executive Compensation” section). Supporting Statement: In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, our shareholders have the opportunity to vote to approve, on an advisory and non-binding basis, the compensation of our named executive officers.Named Executive Officers. At our 20112017 Annual Meeting of Shareholders, our shareholders elected, via an affirmative vote of a majority of all votes cast on the matter, to hold such non-binding, advisory votes on executive compensation on an annual basis, and, accordingly, we have elected to continue to annually hold an advisory vote on the compensation of our named executive officers.Named Executive Officers.
Our executive compensation programs are described in detail in this proxy statement in the section titled "Compensation“Compensation Discussion and Analysis"Analysis,” the accompanying tables and the accompanying tables.related narrative disclosure in this Proxy Statement. These programs are designed to attract and retain talented individuals who possess the skills and expertise necessary to lead Vornado.The Compensation Committee regularly assesses all elements of the compensation paidVornado and to our Named Executive Officers. In 2012, the Compensation Committee implemented a series of modifications to our compensation programs to address input received from our shareholders. A summary of our current compensation programs, inclusive of the aforementioned modifications, is presented in the Compensation Discussion and Analysis section and the accompanying tables and related narrative disclosure in this proxy statement. The Compensation Committee believes that the Company's present compensation programs promote in the best manner possible our business objectives while aligning the interests of the Named Executive Officers with our shareholders to enhance continued positive financial results. During 2015, the Company recorded strong financial results while continuing our simplification and focusing strategy, producing 10.5% growth in comparable funds from operations (per diluted share), and spinning off our strip shopping centers and malls business into Urban Edge Properties (NYSE: UE) in January 2015 and selling over $1 billionThe Compensation Committee regularly assesses all elements of non-core or non-strategic assets and purchasing approximately $850 million of high-quality assets in New York City (including approximately $700 million in Manhattan). We believe the compensation programs forpaid to our Named Executive Officers are a key ingredient in motivating our executives to continue to deliver such results.
Officers.
The results of this advisory vote are not binding on the Compensation Committee, the Company or our Board of Trustees. Nevertheless, theour Board of Trustees values input from our shareholders and will consider carefully the results of this vote when making future decisions concerning executive compensation. The Board of Trustees unanimously recommends a vote "FOR"“FOR” the non-binding, advisory resolution on executive compensation. The affirmative vote of a majority of
all the votes cast on this proposal at the Annual Meeting, assuming a quorum is present, is necessary to approve, on an advisory basis, the compensation of our Named Executive Officers. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the result of
thethis vote.
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2016 PROXY STATEMENT | | | | VORNADO REALTY TRUST | | |
| | 2023 PROXY STATEMENT | | 59 | | |
PROPOSAL 4: NON-BINDING, ADVISORY RESOLUTION ON THE FREQUENCY OF EXECUTIVE COMPENSATION ADVISORY VOTES
In Proposal 3, shareholders are being asked to cast a non-binding, advisory vote with respect to the compensation of the Company’s executive officers named in the Summary Compensation Table. In this Proposal 4, as required by the rules and regulations of the SEC, the Board of Trustees is asking shareholders to cast a non-binding, advisory vote on how frequently such votes with respect to executive compensation should be held in the future. Shareholders will be able to cast their votes on whether to hold votes with respect to executive compensation every one, two or three years. Alternatively, you may abstain from casting a vote. This advisory vote is not binding on the Board.
Advisory Resolution on Frequency of Executive Compensation
Proposal: That the shareholders of Vornado Realty Trust recommend, by a non-binding, advisory vote, whether a non-binding, advisory shareholder vote to approve the compensation of the Company’s named executive officers should occur every one, two or three years.
Board of Trustees Statement: After careful consideration, our Board of Trustees has determined that an advisory vote on executive compensation that occurs every year is the most appropriate for our Company.
The Board of Trustees unanimously recommends a vote for the option of “1 YEAR” as the frequency with which shareholders are provided a non-binding, advisory vote on executive compensation.
The option of one, two or three years receiving the affirmative vote of a majority of all the votes cast on this proposal at the Annual Meeting, assuming a quorum is present, will be considered the frequency recommended by shareholders. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the result of the vote. Shareholder approval of this proposal is not binding upon the Board of Trustees. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the result of this vote.
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PROPOSAL 5: APPROVAL OF THE COMPANY’S 2023 OMNIBUS SHARE PLAN
The Board of Trustees is asking the Company’s shareholders to approve the 2023 Omnibus Share Plan of Vornado Realty Trust (the “2023 Omnibus Share Plan” or the “2023 Plan”). The 2023 Omnibus Share Plan is intended to supersede and replace the Company’s 2019 Omnibus Share Plan (the “2019 Plan”) that is currently in effect. If the 2023 Plan is approved, upon such approval, no additional awards will be made under the 2019 Plan, but the terms and conditions of any outstanding awards granted under the 2019 Plan will not be affected. If the 2023 Plan is not approved by shareholders, no awards will be made under the 2023 Plan, the 2023 Plan will be null and void in its entirety, and the 2019 Plan will remain in full force and effect in accordance with its terms and conditions.
The Board of Trustees has determined that it is in the best interests of the Company to adopt the 2023 Plan, which was unanimously approved by the Board on February 9, 2023. Including the number of Shares remaining available under the 2019 Plan as of April 5, 2023, which was approximately 2.8 million full value Shares, the 2023 Plan provides for the issuance of equity-based awards covering up to 10,800,000 Shares if all awards were full value awards (restricted stock and full value restricted units) or 21,600,000 Shares if all awards were not full value awards (awards that require the grantee to pay an exercise or conversion price or otherwise do not deliver the full value of the underlying Share or underlying OP Unit).
The Board of Trustees believes that the maximum of 10,800,000 full value Share awards that would be available for grant under the 2023 Plan would provide sufficient Shares for equity-based compensation needs of the Company from May 2023 through the 2027 annual shareholder meeting, subject to headcount growth and any unexpected factors. This estimate is based on our recent usage of equity-based awards and growth estimates and is adjusted upward to allow for any one-time performance-based awards that the Board or Compensation Committee may determine to grant in the future to retain and incentivize Company employees, the potential that performance-based awards may be earned above target goals and for flexibility around the types of equity-based awards that may be used. The Company may determine to utilize a substantial portion of Shares available under the 2023 Plan (if adopted by Shareholders), to make one-time grants to certain Company employees, including non-NEOs, for retention purposes and in order to align such employees’ with shareholder returns. While the Compensation Committee has not made any determinations regarding the size or structure of any such awards, and the Compensation Committee may determine not to grant such awards, our current expectation is that awards will be comprised of a mix of time-based and performance-based awards (including tied to operational performance) and a large portion will be performance-based awards that will be linked to total shareholder returns. The actual structure of any awards could be materially different from the description above.
As of April 5, 2023, approximately 2.8 million full value Shares remained available for issuance under the 2019 Plan, which, based on the analysis above and our “burn rate” discussed below and retention considerations, we believe to be sufficient to continue our current grant practices for no more than approximately one year. Running out of capacity to grant additional equity-based compensation, could have significant negative consequences and could, among other things, inhibit our ability to align employees’ interests with those of shareholders through equity-based compensation and impede our ability to attract and retain talent.
Therefore, the Board of Trustees urges you to vote to approve the 2023 Plan.
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Features of the 2023 Omnibus Share Plan
•
No Evergreen or Liberal Share Recycling Provisions. The 2023 Plan does not contain an evergreen provision and authorizes a fixed number of Shares available for grant. Shares tendered by a participant or withheld by the Company in payment of the exercise price or consideration required to be paid, or to satisfy any tax withholding obligation, with respect to an award are not available for future awards.
•
No Discounted Awards or Repricings The exercise price per Share of options and stock appreciation rights may not be less than the fair market value of a Share on the grant date and options and stock appreciation rights may not be repriced without shareholder approval.
•
Clawback, Equity Ownership and Anti-Hedging Policies. Awards under the 2023 Plan will be subject to our policies, including our clawback policy, equity ownership guidelines and anti-hedging policy.
•
One-year Minimum Vesting for all Award Types. Subject to acceleration of vesting for certain events and for certain grants to retirement eligible employees to the extent permitted under the 2023 Plan, awards are subject to a minimum of one-year vesting with a limited exception that up to five percent of available Shares may be subject to awards without this minimum vesting period.
Burn Rate and Overhang
The Company’s historical share usage under its equity compensation plans (sometimes referred to as “burn rate”) and the potential dilution of the Company’s shareholders that could occur as a result of the Company’s equity plans (sometimes referred to as “overhang”) are summarized below.
Burn Rate. The following table sets forth information regarding awards granted and earned, the “burn rate” for each of the last three fiscal years and the average burn rate over the last three years.
| | | | 2020 | | | 2021 | | | 2022 | | | Average | |
(a)
Time-based restricted stock/units granted(1) | | | | | 546,600 | | | | | | 816,019 | | | | | | 501,169 | | | | | | 621,263 | | |
(b)
Performance-based Units earned in the respective years | | | | | — | | | | | | — | | | | | | —(3) | | | | | | — | | |
(c)
Options/AO LTIP Units granted to employees(1) | | | | | 206,753 | | | | | | — | | | | | | — | | | | | | 68,918 | | |
(d)
Net increase in diluted shares due to equity awards (a+b+c)(1) | | | | | 753,353 | | | | | | 816,019 | | | | | | 501,169 | | | | | | 690,180 | | |
(e)
Weighted-average shares outstanding | | | | | 191,146,220 | | | | | | 191,551,085 | | | | | | 191,774,873 | | | | | | 191,490,726 | | |
(f)
Burn rate (d/e)(2) | | | | | 0.39% | | | | | | 0.43% | | | | | | 0.26% | | | | | | 0.36% | | |
(1)
Reflects the gross maximum number of Shares underlying awards granted during the respective year.
(2)
Not adjusted for forfeitures, withholding and expirations, which would reduce the burn rate if taken into account.
(3)
In April 2023, the Compensation Committee determined that 102,366 LTPP Units were initially earned with respect to the operational component of the 2022 LTPP. These units are not reflected in the table above.
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Share Overhang. Based on the calculations set forth below, the total potential dilution or “overhang” resulting from the 10.8 million shares that would be available for grant following adoption of the 2023 Plan, would be 5.63% based on our basic Shares outstanding, or 5.23% based on the diluted Shares outstanding, as of April 5, 2023. Taking into account Shares underlying outstanding awards under the 2010 and 2019 Omnibus Share Plans, the dilution rate would be 8.79% or 8.16% on a basic and diluted basis, respectively.
We believe that shareholders should evaluate the “share overhang” or dilution rate, based on the number of Shares available under the 2023 plan (as calculated in rows (i) and (j) below) without taking into account the Shares underlying outstanding awards under the 2010 and 2019 Omnibus Share Plans because such awards are already outstanding regardless of adoption of the 2023 Plan.
In addition, we believe that shareholders should evaluate the “share overhang” or dilution rate, as set forth in the table below, using 10,800,000 shares available under the 2023 Plan (row (a)) which represents the maximum amount of Full-Value shares that would be available under the 2023 Plan, rather than using the 21,600,000 number of options that are available under the 2023 Plan (representing two times the amount of full-value shares available) given that option awards require the holder to pay an exercise to the Company based on the grant date Share price.
| | (a) | | | Shares available under the 2023 Plan | | | | | 10,800,000 | | |
| | (b) | | | Shares underlying outstanding awards under the 2010 and 2019 Omnibus Share
Plans(1) | | | | | 6,070,183 | | |
| | (c) | | | Shares remaining available under the 2010 and 2019 Omnibus Share Plans (upon
adoption of the 2023 Omnibus Share Plan) | | | | | — | | |
| | (d) | | | Total Shares authorized for or outstanding under equity awards (a+b+c) | | | | | 16,870,189 | | |
| | (e) | | | Common shares outstanding | | | | | 191,880,615 | | |
| | (f) | | | Diluted Shares outstanding | | | | | 206,698,025 | | |
| | (g) | | | Overhang of Total Shares authorized for or outstanding under equity awards per basic
common shares outstanding (d/e) | | | | | 8.79% | | |
| | (h) | | | Overhang per diluted common shares outstanding (d/f) | | | | | 8.16% | | |
| | (i) | | | Overhang of Shares available under the 2023 Plan per basic common shares
outstanding (a/e) | | | | | 5.63% | | |
| | (j) | | | Overhang of Shares available under the 2023 Plan per diluted common shares
outstanding (a/f) | | | | | 5.23% | | |
(1)
Shares underlying outstanding awards include 367,374 stock options and AO LTIP Units. The weighted average strike price for these awards is $64.22 and the average remaining term is 5.15 years. In addition, there are awards of 5,702,809 shares and units outstanding, of which 2,140,276 are performance-based awards.
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SUMMARY OF THE 2023 OMNIBUS SHARE PLAN
A copy of the full text of the 2023 Plan is attached as Annex A to this proxy statement and the summary below of the 2023 Plan is qualified in its entirety by reference to the text of the 2023 Plan. For additional information regarding equity-based compensation granted to our Named Executive Officers in 2022, see “Compensation Discussion and Analysis.”
Purpose
The purpose of the 2023 Plan is to promote the interests of the Company by encouraging its employees and the employees of its subsidiaries, including officers (together, the “Employees”), its non-employee trustees and non-employee directors of its subsidiaries (together, the “Non-Employee Trustees) and certain non-employee advisors and consultants that provide bona fide services to the Company or its subsidiaries (together, the “Consultants”) to acquire an ownership position in the Company, enhancing its ability to attract and retain Employees, Non-Employee Trustees and Consultants of outstanding ability and providing such Employees, Non-Employee Trustees and Consultants with a way to acquire or increase their proprietary interest in the Company’s success and to further align the interests of Employees, Non-Employee Trustees and Consultants with shareholders.
Overview
Under the 2023 Plan, eligible participants may be granted awards of stock options, stock appreciation rights, performance shares, restricted stock, other stock-based awards (including the grant or offer for sale of unrestricted Shares) and limited partnership units (“OP Units”) of Vornado Realty L.P. (or any successor entity), the entity through which the Company conducts substantially all its business (including appreciation-only OP Units). Awards of performance shares, restricted stock and other stock-based awards may provide the holder with dividends or dividend equivalents and voting rights prior to vesting. If dividends or dividend equivalents are granted, dividend and dividend equivalents will be paid to the holder at the same time as the Company pays dividends to holders of the Company’s Shares but not less than annually. Notwithstanding the foregoing, a holder’s right to dividends and dividend equivalent payments in the case of an award that is subject to performance-based conditions will be treated as unvested so long as the performance conditions have not been met, and any such dividend equivalent payments that would otherwise have been paid during the performance period will instead be accumulated and paid within 30 days following the date on which such award is determined by the Company to have been earned.
Shares Available for Grant under the 2023 Plan
Subject to adjustment as described below, awards may be granted under the 2023 Plan with respect to a maximum of 10,800,000 Share Equivalents (as defined below), which, in accordance with the share counting provisions of the 2023 Plan, would result in the issuance of up to a maximum of 10,800,000 Shares if all awards granted under the 2023 Plan were Full Value Awards (as defined below) and 21,600,000 Shares if all of the awards granted under the 2023 Plan were Not Full Value Awards (as defined below) (which includes approximately 2.8 million Shares remaining under the 2019 Plan on April 5, 2023). “Share Equivalents” are the measuring unit for determining the number of Shares that may be subject to awards.
The 2023 Plan is commonly referred to as a fungible unit plan. Restricted shares, restricted units or other securities that have a value equivalent to a full Share are referred to as “Full Value Awards.” Securities such as options, appreciation-only OP Units or stock appreciation rights that require the grantee to pay an exercise or conversion price or otherwise do not deliver the full value of the underlying Share or underlying OP Unit due to the deduction of a strike price are referred to as “Not Full Value Awards.” When a grant is made under the 2023 Plan, we will reduce the number of Share Equivalents available under the 2023 Plan (1) one Share Equivalent for each Share awarded pursuant to an award that is a Full Value Award and (2) one-half a Share Equivalent for each Share awarded pursuant to an award that is a Not Full Value Award, such that a Share underlying a Full Value Award reduces the number of Share Equivalents available under the 2023 Plan by double the number that a Share underlying a Non-Full Value Award would. This means, for instance, if we were to award only restricted shares under the 2023 Plan, we could award 10,800,000 restricted shares. On the other hand, if we were to award only options under the 2023 Plan, we could award options to purchase 21,600,000 Shares (at the applicable exercise price). We also could issue any combination of the foregoing (or of other securities available under the 2023 Plan) with the reductions in availability to be made in accordance with the foregoing ratios.
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If any award granted under the 2023 Plan expires or is forfeited, terminated or cancelled, or is paid in cash in lieu of Shares, then the Shares underlying any such award will again become available for grant under the 2023 Plan in an amount equal to one Share Equivalent for each Share that is subject to a Full Value Award and by one-half Share Equivalent for each Share that is subject to an award that is a Not Full Value Award, in each case, at the time such award expires or is forfeited, terminated or cancelled. Awards that are settled in cash do not affect the number of Share Equivalents available for awards under the 2023 Plan to the extent paid or settled in cash.
The number of Share Equivalents available under the 2023 Plan will be reduced (1) upon the exercise of a stock option, appreciation-only OP Unit or a stock appreciation right by one-half of the gross number of Shares for which the award is exercised even if the award is exercised by means of a net-settlement exercise procedure or if Shares are withheld to satisfy any tax withholding obligation and (2) by one Share for each Share withheld to satisfy any tax withholding obligation with respect to any Full Value Award. Awards issued or assumed under the 2023 Plan in connection with any merger, consolidation, acquisition of property or stock, reorganization or similar transaction will not count against the number of Share Equivalents that may be granted under the 2023 Plan.
No more than 21,600,000 Shares (subject to adjustment as described below) may be issued upon the exercise of “incentive stock options” (within the meaning of Section 422 of the Internal Revenue Code) granted under the 2023 Plan.
Shares issued under the 2023 Plan would be authorized and unissued Shares. The fair market value of one Share on March 20, 2023 was $14.61 per Share (the average of the high and low market price on the New York Stock Exchange on that date).
Estimate of Benefits
Because awards under the 2023 Plan are made on a discretionary basis by the Board or Compensation Committee, it is not possible to determine the benefits that will be received by our executive officers and other key employees. Information on our most recent equity awards is set forth under “Compensation Discussion and Analysis,” “Executive Compensation” and “New Plan Benefits.”
Adjustment of and Changes in Shares
In the event of any change in the outstanding Shares by reason of any share dividend or split, reverse split, reclassification, recapitalization, merger, consolidation, spinoff, combination or exchange of Shares or other corporate change, or any distributions to shareholders other than regular cash dividends (including, without limitation, a distribution of common or preferred shares of beneficial interest of the Trust), the Compensation Committee will make such substitution or adjustment, if any, as it deems equitable to (1) the kinds of common shares, preferred shares or other securities, and the number of Share Equivalents, for which awards may be granted under the 2023 Plan, (2) the number and kinds of Shares or other securities issued or reserved for issuance pursuant to outstanding awards and (3) the number and kinds of Shares or other common shares that can be issued through incentive stock options.
Administration
The 2023 Plan will be administered and interpreted by the Compensation Committee. The Compensation Committee is authorized to select Employees, Non-Employee Trustees and Consultants to receive awards, determine the type of awards to be made, determine the number of equity-based securities subject to any award and the other terms and conditions of such awards. Our Board of Trustees, in its sole discretion, also may grant awards or administer the 2023 Plan.
Eligibility
As of December 31, 2022, 560 Employees, 9 Non-Employee Trustees and 4 Consultants would have been eligible to participate in and receive awards under the 2023 Plan, if it had been adopted and effective at such time.
Transfer Restrictions
Awards are not assignable or transferable except by will or the laws of descent and distribution and no right or interest of any holder may be subject to any lien, obligation or liability of the holder. The Compensation Committee
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may determine, at the time of grant or thereafter, that an award (other than stock options intended to be incentive stock options within the meaning of Section 422 of the Internal Revenue Code) is transferable by a holder to such holder’s immediate family members (or trusts, partnerships or limited liability companies established for such immediate family members).
Clawback/Recoupment
Awards granted under the 2023 Plan will be subject to the requirement that the awards be forfeited or repaid to the Company after they have been distributed to the participant (i) to the extent set forth in an award agreement or (ii) to the extent covered by any clawback or recapture policy adopted by the Company from time to time, or any applicable laws that impose mandatory forfeiture or recoupment, under circumstances set forth in such applicable laws.
Term; Amendment and Termination
The 2023 Plan has a term through May 18, 2033, but any award granted prior to such date, and the Compensation Committee’s authority to administer the terms of such awards, will remain in effect until the award is settled or lapses. The 2023 Plan will be effective, subject to its approval by the shareholders, as of the date of the approval by the requisite number of shareholders of the Trust at the 2023 Annual Meeting. The Compensation Committee may amend or terminate the 2023 Plan or any portion of the 2023 Plan at any time, except that no amendment may be made without shareholder approval if such amendment (i) would increase the maximum aggregate number of Shares that may be issued under the 2023 Plan, (ii) would materially expand the class of service providers eligible to participate in the 2023 Plan, (iii) would result in a material increase in the benefits accrued to participants under the 2023 Plan, (iv) would reduce the exercise or conversion price of outstanding stock options or stock appreciation rights or cancel outstanding stock options or stock appreciation rights in exchange for cash, other awards or stock options or stock appreciation rights with an exercise or conversion price that is less than the exercise or conversion price of the original stock options or stock appreciation rights or (v) requires shareholder approval to comply with any applicable laws, regulations or rules, including the rules of a securities exchange or self-regulatory agency. If there is a change in applicable tax law such that OP Units become taxable to the holder of such OP Units as ordinary income, the Operating Partnership, at any time in the sole discretion of the Company or the general partner of the Operating Partnership, may cause the OP Units to be restructured and/or substituted for other awards in a way that permits a tax deduction to the Operating Partnership or the Company while preserving substantially similar pre-tax economics to the holder of such OP Units.
Types of Awards
Operating Partnership Units
OP Units are valued by reference to the value of the underlying Shares to which such award relates. The employment conditions, the length of the period for vesting and other applicable conditions and restrictions of OP Unit awards, including computation of financial metrics and/or achievement of pre-established performance goals, are established by the Compensation Committee. Such OP Unit awards may provide the holder with dividend-equivalent rights prior to vesting.
Appreciation-Only OP Units (or AO LTIP Units).
“AO LTIP Units” are a class of OP Units that are intended to produce for holders a substantially similar non-tax economic effect as that of options. Each AO LTIP Unit is potentially convertible into Class A OP Units (each one of which is ultimately redeemable for one Share or cash at the option of the Company). Each AO LTIP Unit will be issued under the 2023 Plan and may be convertible for up to a period of 10 years from the date of grant. The employment conditions, the length of the period for vesting and other applicable conditions and restrictions of AO LTIP Unit awards, including computation of financial metrics and/or achievement of pre-established performance goals, are established by the Compensation Committee. On the date of grant, each AO LTIP Unit is awarded with a specified conversion price. That conversion price will never be lower (and may be significantly higher) than the price for one Share on the date of grant. Each AO LTIP Unit, on conversion, will be converted into such number of Class A OP Units that has a value equal to the excess of the closing price per Share on the date of conversion on the New York Stock Exchange over the specified conversion price. After a required two-year
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holding period, those Class A OP Units, in turn, may be redeemable for Shares. Such AO LTIP Unit awards may provide the holder with dividend-equivalent rights prior to vesting.
Stock Options
Stock options entitle the holder to purchase the Company’s Shares at a per Share price determined by the Compensation Committee, which in no event may be less than the fair market value of the Shares on the date of grant. Options may be either “incentive stock options” within the meaning of Section 422 of the Internal Revenue Code or “non-qualified” stock options.
Stock options are exercisable for such period as is determined by the Compensation Committee, but in no event may options be exercisable after 10 years from the date of grant. The option price for Shares purchased upon the exercise of an option must be paid in full at the time of exercise and may be paid in cash, by tender of Shares, by such other consideration as the Compensation Committee deems appropriate or by a combination of cash, Shares and such other consideration. Like the 2019 Plan, the 2023 Plan does not provide for the grant of “reload stock options” (meaning, if a grantee were to pay the applicable exercise in Shares already owned, the grantee would automatically be granted a new option in the amount of the surrendered Shares).
Stock Appreciation Rights
Stock appreciation rights entitle the holder to receive from the Company an amount equal to the amount by which the fair market value of a Share on the date of exercise exceeds the grant price. The Compensation Committee will establish the grant price, which may not be less than the fair market value of the Shares on the date of grant and the term, which will not be more than 10 years from the date of grant. Stock appreciation rights may be granted in tandem with a stock option or in addition to a stock option or may be freestanding and unrelated to a stock option. The Compensation Committee is authorized to determine whether a stock appreciation right will be settled in cash, Shares or a combination thereof. Stock appreciation rights settled in cash will not reduce the number of Shares issuable under the 2023 Plan.
Performance Shares
Performance share awards consist of a grant of actual Shares or Share units having a value equal to an identical number of the Company’s Shares in amounts determined by the Compensation Committee at the time of grant. Performance share awards consisting of actual Shares entitle the holder to receive Shares in an amount based upon performance conditions of the Company over a performance period as determined by the Compensation Committee at the time of grant. Such performance share awards may provide the holder with dividends and voting rights prior to vesting, subject to dividend accumulation until vested as described above. Performance share awards consisting of Share units entitle the holder to receive the value of such units in cash, Shares or a combination thereof based upon performance conditions and over a performance period as determined by the Compensation Committee at the time of grant.
Restricted Shares
Restricted share awards consist of a grant of actual Shares or Share units having a value equal to an identical number of Shares of the Company. Restricted share awards consisting of actual Shares entitle the holder to receive Shares of the Company. Such restricted share awards may provide the holder with dividends and voting rights prior to vesting. Restricted share awards consisting of Share units entitle the holder to receive the value of such units in cash, Shares or a combination thereof as determined by the Compensation Committee and may provide the holder with dividends. The employment or other conditions and the length of the period for vesting of restricted share awards are established by the Compensation Committee at the time of grant.
Other Stock-Based Awards
Other types of equity-based or equity-related awards, including the grant or offer for sale of unrestricted Shares, may be granted under such terms and conditions as may be determined by the Compensation Committee.
Vesting
The Compensation Committee will determine the time or times at which awards become vested, unrestricted or may be exercised, subject to the following limitations. Subject to accelerated vesting upon certain events that may
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be specified in an award agreement, including upon an involuntary termination of employment or service, the occurrence of a change in control or a grantee’s retirement, disability, hardship or death, (i) awards that are not Full Value Awards will not vest or be exercisable earlier than the first anniversary of the date on which such award is granted, (ii) time-based vesting awards of Full Value Awards will be subject to a minimum one-year vesting period and (iii) performance-based vesting awards of Full Value Awards will have a performance period that ends no earlier than the first anniversary of the commencement of the period over which performance is evaluated. Notwithstanding the foregoing, (x) a maximum of 5% of the maximum aggregate number of Share Equivalents available under the 2023 Plan in respect of awards and (y) Share Equivalents granted to retirement eligible grantees can be subject to awards without regard to the minimum vesting limits in the preceding sentence.
Change in Control
In the event of a change in control (as defined in the 2023 Plan), the Compensation Committee may take one or more of the following actions with respect to outstanding awards, in its sole discretion: (i) settle awards for an amount of cash or securities, where in the case of stock options and stock appreciation rights, the value of such amount, if any, will be equal to the in-the-money spread value of such awards; (ii) provide for the assumption of or the issuance of substitute awards; (iii) modify the terms of such awards to add events, conditions or circumstances upon which the vesting of such awards or lapse of restrictions thereon will accelerate; (iv) deem any performance conditions satisfied or provide for the performance conditions to continue (in accordance with their terms or as adjusted by the Compensation Committee) after the change in control or (v) provide that for a period of at least 20 days prior to the change in control, any stock options or stock appreciation rights that would not otherwise become exercisable prior to the change in control will be exercisable as to all Shares subject thereto (but any such exercise will be contingent upon and subject to the occurrence of the change in control) and that any stock options or stock appreciation rights not exercised prior to the consummation of the change in control will terminate.
Material U.S. Federal Income Tax Consequences of Awards
Below is a brief summary of the principal U.S. federal income tax consequences of awards under the 2023 Plan under current law. This summary is not intended to be exhaustive and does not describe, among other things, state, local or foreign income, withholding and payroll tax matters, and other tax consequences. The specific tax consequences to a participant will depend on that participant’s individual circumstances.
Incentive Stock Options. Upon the grant or exercise of an incentive stock option, no income will be recognized by the optionee for federal income tax purposes (except as otherwise noted below with respect to the alterative minimum tax), and the Company will not be entitled to any deduction. If the Shares acquired upon exercise are not disposed of within the one-year period beginning on the date of the transfer of the Shares to the optionee, nor within the two-year period beginning on the date of the grant of the option, any gain or loss realized by the optionee upon the disposition of such Shares will be taxed as long-term capital gain or loss. In such event, no deduction will be allowed to the Company. If such Shares are disposed of within the periods referred to above, the excess of the fair market value of the Shares on the date of exercise (or, if less, the fair market value on the date of disposition, if the disposition is a sale or exchange with respect to which a loss, if sustained, would be recognized by the optionee) over the exercise price will be taxable as ordinary income to the optionee at the time of disposition, and the Company generally will be entitled to a corresponding deduction. The amount by which the fair market value of the Shares at the time of exercise of an incentive stock option exceeds the option price will constitute an item of tax preference that could subject the optionee to the alternative minimum tax. Whether the optionee will be subject to such tax depends on the facts and circumstances applicable to the individual.
Non-Qualified Stock Options. Upon the grant of a non-qualified stock option, no income will be realized by the optionee, and the Company will not be entitled to any deduction. Upon the exercise of such an option, the amount by which the fair market value of the Shares at the time of exercise exceeds the exercise price will be taxed as ordinary income to the optionee, and the Company generally will be entitled to a corresponding deduction. All option grants to Non-Employee Trustees and Consultants are treated as non-qualified options for federal income tax purposes.
Stock Appreciation Rights. Upon the grant of a stock appreciation right, no taxable income will be realized by the holder, and the Company will not be entitled to any tax deduction. Upon the exercise of a stock appreciation right, the amount by which the fair market value of the Shares at the time of exercise exceeds the grant price will be taxed as ordinary income to the holder, and the Company generally will be entitled to a corresponding deduction.
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Performance Shares and Restricted Shares. A participant will not be subject to tax upon the grant of a restricted share unit, or upon the grant of actual restricted Shares, unless such participant makes the election referred to below with respect to restricted Shares. Upon the vesting date (the date of lapse of the applicable forfeiture conditions or transfer restrictions, in the case of Share awards and, in the case of unit awards, the date of vesting and distribution of the Shares and/or cash underlying the units), the participant will recognize ordinary income equal to the fair market value of the Shares and/or cash received (less any amount such participant may have paid for the Shares), and the Company generally will be entitled to a deduction equal to the amount of income recognized by such participant. In the case of an award of actual restricted Shares, if any dividends are paid on such common shares prior to the vesting date, they will be includible in a participant’s income during the restricted period as additional compensation (and not as dividend income).
A participant may elect to recognize immediately, as ordinary income, the fair market value of restricted Shares (less any amount paid for the Shares) on the date of grant, without regard to applicable forfeiture conditions and transfer restrictions. This election is referred to as a Section 83(b) election. If a participant makes this election, the holding period will begin the day after the date of grant, dividends paid on the Shares will be subject to the normal rules regarding distributions on stock and no additional income will be recognized by such participant upon the vesting date. However, if a participant forfeits the restricted Shares before the vesting date, no deduction or capital loss will be available to that participant in excess of any amount paid for the Shares (even though the participant previously recognized income with respect to such forfeited Shares). In the event that the Shares are forfeited by such participant, the Company generally will include in its income the amount of its original deduction.
OP Units. OP Unit awards (including AO LTIP Unit awards) are intended to be structured to qualify as “profits interests” for federal income tax purposes, meaning that, under current law, no income will be recognized by the recipient upon grant or vesting, and the Company will not be entitled to any deduction. If OP Units are not disposed of within the three-year period beginning on the date of grant of the OP Unit award, any gain realized by the recipient upon disposition will generally be taxed as long-term capital gain (assuming the applicable tax elections are made by the grantee in connection with the grant of the award).
Disposition of Shares. Unless stated otherwise above, upon the subsequent disposition of Shares acquired under any of the preceding awards, the participant will recognize capital gain or loss based upon the difference between the amount realized on such disposition and the participant’s basis in the Shares, and such amount will be long term capital gain or loss if such Shares were held for more than 12 months.
Additional Tax on Net Investment Income. Participants are subject to a 3.8% tax on the lesser of (i) the participant’s “net investment income” for the relevant taxable year and (ii) the excess of the participant’s modified adjusted gross income for the taxable year over a certain threshold (between $125,000 and $250,000, depending on the participant’s circumstances). A participant’s net investment income generally includes dividend income and net gains from the disposition of Shares. Participants are urged to consult their tax advisors regarding the applicability of this tax on net investment income to their income and gains in respect of their investment in Shares.
Section 409A. If an award is subject to Section 409A of the Code, but does not comply with the requirements of Section 409A of the Code, the taxable events as described above could apply earlier than described, and could result in the imposition of additional taxes and penalties. Participants are urged to consult with their tax advisors regarding the applicability of Section 409A of the Code to their awards.
Non-Employee Trustees. The discussion above generally applies to awards to Non-Employee Trustees; provided that Non-Employee Trustees are not eligible to receive grants of incentive stock options, and any amounts taxable to Non-Employee Trustees in respect of awards are not subject to Federal Insurance Contributions Act (“FICA”) taxes (but may instead be subject to certain self-employment taxes). Generally, cash-based awards, including retainers and fees, will be taxable to the recipient as ordinary income at the time paid.
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New Plan Benefits
No awards will be granted under the 2023 Plan prior to its approval by our shareholders. Awards under the 2023 Plan will be granted at the discretion of the Compensation Committee. As a result, it is not possible to determine the number or type of awards that will be granted to any person under the 2023 Plan. The awards granted in 2023 (for 2022 performance) under the 2019 Plan, which would not have changed if the 2023 Plan had been in place instead of the 2019 Plan, are set forth in the table below.
| Name and Position | | | Dollar Value ($)(1) | | | 2019 Omnibus
Share Plan
Number of
Shares and
Units | |
| Steven Roth | | | 11,167,928 | | | 501,366 | |
| Michael J. Franco | | | 3,420,304 | | | 153,549 | |
| Haim Chera | | | 1,091,675 | | | 49,009 | |
| Glen J. Weiss | | | 3,169,666 | | | 142,297 | |
| Barry S. Langer | | | 2,749,203 | | | 123,421 | |
| Current executive officers as a group (includes NEOs) | | | 22,488,261 | | | 1,009,574 | |
| Employees other than executive officers as a group | | | 1,965,947 | | | 88,258 | |
(1)
Dollar value reflects the number of units issued multiplied by the average of the high and low Share price on the date of grant and does not apply a fair value discount and accordingly results in a higher value than the Grant Date Fair Value of such awards.
The Board of Trustees unanimously recommends a vote “FOR” the approval of the Company’s 2023 Omnibus Share Plan.
The affirmative vote of holders of a majority of the votes cast on this proposal at the Annual Meeting, assuming a quorum is present, is necessary to approve the 2023 Plan. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the result of this vote.
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INCORPORATION BY REFERENCE To the extent this proxy statement is incorporated by reference into any other filing by the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act, of 1934, the sections entitled "Compensation“Compensation Committee Report on Executive Compensation"Compensation” and "Report“Report of the Audit Committee" (toCommittee” (to the extent permitted by the rules of the SEC) will not be deemed incorporated unless provided otherwise in such filing. ADDITIONAL MATTERS TO COME BEFORE THE MEETING The Board does not intend to present any other matter, nor does it have any information that any other matter will be brought, before the Annual Meeting. However, if any other matter properly comes before the Annual Meeting, it is the intention of each of the individuals named in the accompanying proxy to vote said proxy in accordance with theirhis or her discretion on such matters. PROXY AUTHORIZATION VIA THE INTERNET OR BY TELEPHONE We have established procedures by which shareholders may authorize their proxies via the Internet or by telephone. You may also authorize your proxy by mail. Please see the proxy card or voting instruction form accompanying this proxy statement for specific instructions on how to authorize your proxy by any of these methods. Proxies authorized via the Internet or by telephone must be received by 11:59 P.M., New York City time, on Wednesday, May 18, 2016.17, 2023. Authorizing your proxy via the Internet or by telephone will not affect your right to revoke your proxy should you decide to do so. The Internet and telephone proxy authorization procedures are designed to authenticate shareholders'shareholders’ identities, to allow shareholders to give their voting instructions and to confirm that shareholders'shareholders’ instructions have been recorded properly. The Company has been advised that the Internet and telephone proxy authorization procedures that have been made available are consistent with the requirements of applicable law. Shareholders authorizing their proxies via the Internet or by telephone should understand that there may be costs associated with voting in these manners, such as charges forfrom Internet access providers and telephone companies, that must be borne by the shareholder. HOUSEHOLDING OF ANNUAL MEETING MATERIALS
Some banks, brokers, broker-dealers and other similar organizations acting as nominee record holders may be participating in the practice of “householding” proxy statements and annual reports. This means that only one copy of this proxy statement may have been sent to multiple shareholders in your household. If you would prefer to receive separate copies of a proxy statement or annual report for other shareholders in your household, either now or in the future, please contact your bank, broker, broker-dealer or other similar organization serving as your nominee. Upon written or oral request to the Company at 888 Seventh Avenue, New York, New York 10019, or via telephone at 212-894-7000, the Company will provide separate copies of the annual report and/or this proxy statement. If a shareholder receives multiple copies of the annual report and/or this proxy statement, he or she may request householding in the future by contacting the Company at 888 Seventh Avenue, New York, New York 10019 or calling 212-894-7000.
ADVANCE NOTICE FOR SHAREHOLDER NOMINATIONS AND SHAREHOLDER PROPOSALS The Bylaws of the Company currently provide that in order for a shareholder to nominate a candidate for election as a Trustee at an Annual Meeting of Shareholders outside of the proxy access provision in the Bylaws described below or propose business for consideration at such meeting (other than a proposal for inclusion in the proxy statement for the Company’s Annual Meeting of Shareholders in 2024 pursuant to Rule 14a-8 under the Securities
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Exchange Act), notice must be given to the Secretary of the Company no more than 120150 days nor less than 90120 days prior to the first anniversary of the date of the proxy statement of the preceding year'syear’s Annual Meeting and must include certain information specified in the Bylaws. As a result, any notice given by or on behalf of a shareholder pursuant to the provisions of our current Bylaws (other than the proxy access provision) must comply with the requirements of the Bylaws and must be delivered to the Secretary of the Company at the principal executive office of the Company, 888 Seventh Avenue, New York, New York 10019, betweennot earlier than November 9, 2023, and including January 19, 2017not later than the close of business on December 9, 2023.
Shareholders providing notice to the Company under the SEC’s rule 14a-19 who intend to solicit proxies in support of nominees other than the Company’s nominees for the 2024 Annual Meeting must comply with the above deadlines, the requirements of our Bylaws and February 18, 2017. any additional requirements of Rule 14a-19(b).
Shareholders who wish to submit a “proxy access” nomination for inclusion in our proxy statement in connection with our 2023 Annual Meeting of Shareholders must submit a written notice in compliance with the procedures and along with the other information required by our current Bylaws to the Secretary of the Company at the principal executive office of the Company, 888 Seventh Avenue, New York, New York 10019, not earlier than November 9, 2023, and not later than December 9, 2023.
The Board of Trustees may amend the Bylaws from time to time. Shareholders interested in presenting a proposal for inclusion in the proxy statement for the Company'sCompany’s Annual Meeting of Shareholders in 20172024 may do so by following the procedures in Rule 14a-8 under the Securities Exchange Act of 1934.Act. To be eligible for inclusion, shareholder proposals must be received at the
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| | 60 | | | | VORNADO REALTY TRUST | | | | 2016 PROXY STATEMENT |
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principal executive office of the Company, 888 Seventh Avenue, New York, New York 10019, Attention: Secretary, not later than the close of business on December 9, 2016.
| | |
| | By Order of the Board of Trustees, |
| | Alan J. Rice
Secretary
|
| | New York, New York
April 8, 2016
|
By Order of the Board of Trustees,Steven J. Borenstein
Secretary
New York, New York
April 7, 2023
It is important that proxies be returned promptly. Please authorize your proxy over the Internet, by telephone or by
requesting, executing and returning a proxy card or voting instruction form.
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| | | | | | | | | | | |
2016 PROXY STATEMENT | | | | VORNADO REALTY TRUST | | | | 6189 | | |
ANNEX A
Vornado Realty Trust
2023 Omnibus Share Plan
(Subject to approval by shareholders on May 18, 2023)
ANNEX A
CORPORATE GOVERNANCE GUIDELINES
I. Introduction
The Board of Trustees (the "Board") of Vornado Realty Trust (the "Trust"), acting on the recommendation of its Corporate Governance and Nominating Committee, has developed and adopted a set of corporate governance principles (the "Guidelines") to promote the functioning of the Board and its committees and to set forth a common set of expectations as to how the Board should perform its functions. These Guidelines are in addition to the Trust's Amended and Restated Declaration of Trust and Amended and Restated Bylaws, in each case as amended. References to the masculine, feminine or neuter gender herein shall be deemed to include the others whenever the context so indicates or requires.
II. Board Composition
The composition of the Board should balance the following goals:
nThe size of the Board should facilitate substantive discussions of the whole Board in which each Trustee can participate meaningfully;
nThe composition of the Board should encompass a broad range of skills, expertise, industry knowledge, diversity of opinion and contacts relevant to the Trust's business; and
nA majority of the Board shall consist of Trustees who the Board has determined are "independent" under the Corporate Governance Rules (the "NYSE Rules") of The New York Stock Exchange, Inc. (the "NYSE").
III. Selection of Chairman of the Board and Chief Executive Officer
The Board is free to select its Chairman and the Trust's Chief Executive Officer in the manner it considers in the best interests of the Trust at any given point in time. These positions may be filled by one individual or by two different individuals.
IV. Selection of Trustees
Nominations. The Board is responsible for selecting the nominees for election to the Board. The Corporate Governance and Nominating Committee is responsible for recommending to the Board a slate of Trustees or one or more nominees to fill vacancies occurring between annual meetings of shareholders. The Corporate Governance and Nominating Committee may, in its discretion, work or otherwise consult with members of management of the Trust in preparing the Corporate Governance and Nominating Committee's recommendations.
Criteria. The Board should, based on the recommendation of the Corporate Governance and Nominating Committee, consider new nominees for the position of independent Trustee on the basis of the following criteria:
nPersonal qualities and characteristics, accomplishments and reputation in the business community;
nCurrent knowledge and contacts in the communities in which the Trust does business and in the Trust's industry or other industries relevant to the Trust's business;
nAbility and willingness to commit adequate time to Board and committee matters;
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| | 2023 PROXY STATEMENT | | 2016 PROXY STATEMENT |
nThe fit of the individual's skills and personality with those of other Trustees and potential Trustees in maintaining a Board that is effective, collegial and responsive to the interests of the Trust; and
nDiversity of viewpoints, experience and other demographics (including race, age and gender). The Trust is committed to including persons of diverse backgrounds in candidate pools when seeking new members of the Board. However, nomination of a candidate should not be based solely on these factors.
Independence Standards. To qualify as independent under the NYSE Rules, the Board must affirmatively determine that a Trustee has no material relationship with the Trust and/or its consolidated subsidiaries. The Board has adopted the following categorical standards to assist it in making determinations of independence. For purposes of these standards, references to the "Trust" mean Vornado Realty Trust and its consolidated subsidiaries.
The following relationships have been determined not to be material relationships that would categorically impair a Trustee's ability to qualify as independent:
1.Payments to and from other organizations. A Trustee's or his immediate family member's status as executive officer or employee of an organization that has made payments to the Trust, or that has received payments from the Trust, not in excess of the greater of:
(i)$1 million; or
(ii)2% of the other organization's consolidated gross revenues for the fiscal year in which the payments were made.
In the case where an organization has received payments that ultimately represent amounts due to the Trust and such amounts are not due in respect of property or services from the Trust, these payments will not be considered amounts paid to the Trust for purposes of determining (i) and (ii) above so long as the organization does not retain any remuneration based upon such payments.
2.Beneficial ownership of the Trust's equity securities. Beneficial ownership by a Trustee or his immediate family member of not more than 10% of the Trust's equity securities. A Trustee or his immediate family member's position as an equity owner, director, executive officer or similar position with an organization that beneficially owns not more than 10% of the Trust's equity securities.
3.Common ownership with the Trust. Beneficial ownership by, directly or indirectly, a Trustee, either individually or with other Trustees, of equity interests in an organization in which the Trust also has an equity interest.
4.Directorships with, or beneficial ownership of, other organizations. A Trustee's or his immediate family member's interest in a relationship or transaction where the interest arises from either or both of:
(i)his or his family member's position as a director with an organization doing business with the Trust; or
(ii)his or his family member's beneficial ownership in an organization doing business with the Trust so long as the level of beneficial ownership in the organization is 25% or less, or less than the Trust's beneficial ownership in such organization, whichever is greater.
5.Affiliations with charitable organizations. The affiliation of a Trustee or his immediate family member with a charitable organization that receives contributions from the Trust, or an affiliate of the Trust, so long as such contributions do not exceed for a particular fiscal year the greater of:
(i)$1 million; or
(ii)2% of the organization's consolidated gross revenues for that fiscal year.
91 | | | | | | | | | | | | | | | | | | | | | | 91 | | | 2016 PROXY STATEMENT | | | | | | 92 | | | | | | | | | | 92 | | | | | | | | | | 93 | | | | | | | | | | 93 | | | | | | | | | | 94 | | | | | | | | | | 94 | | | | | | | | | | 95 | | | | | | | | | | 95 | | | | | | | | | | 95 | | | | | | | | | | 95 | | | | | | | | | | 95 | | | | | | | | | | 96 | | | | | | | | | | 96 | | | | | | | | | | 97 | | | | | | | | | | 97 | | | | | | | | | | 97 | | | | | | | | | | 97 | | | | | | | | | | 98 | | | | | | | | | | 98 | | | | | | | | | | 98 | | |
| | | VORNADO REALTY TRUST | | | | 6391 | | |
1.
Purpose The purpose of the 2023 Omnibus Share Plan of Vornado Realty Trust (as amended from time to time, the “Plan”), is to promote the interests of Vornado Realty Trust (the “Trust”), including its growth and performance, by encouraging employees of the Trust and its subsidiaries, including officers (together, the “Employees”), its non-employee trustees of the Trust and non-employee directors of its subsidiaries (together, the “Non-Employee Trustees”) and certain non-employee advisors and consultants that provide bona fide services to the Trust or its subsidiaries (together, the “Consultants”) to acquire an ownership position in the Trust, enhancing the ability of the Trust and its subsidiaries to attract and retain Employees, Non-Employee Trustees and Consultants of outstanding ability, and providing Employees, Non-Employee Trustees and Consultants with a way to acquire or increase their proprietary interest in the Trust’s success and to further align the interests of the Employees, Non-Employee Trustees and Consultants with shareholders of the Trust. Each of the terms set forth in the Appendix is defined in the Section of the Plan set forth opposite such term. The Plan replaces the Vornado Realty Trust 2019 Omnibus Share Plan, as amended (the “Predecessor Plan”), for awards granted on or after the Effective Date (as defined in Section 22). Awards may not be granted under the Predecessor Plan beginning on the Effective Date, but the adoption and effectiveness of the Plan will not affect the terms or conditions of any outstanding grants under the Predecessor Plan prior to the Effective Date. 2.
Shares Available for Awards Subject to the provisions of this Section 2 or any adjustment as provided in Section 18, awards may be granted under the Plan with respect to 10,800,000 Share Equivalents (as defined below), which, in accordance with the share counting provisions of this Section 2, would result in the issuance of up to a maximum of 10,800,000 common shares, par value $0.04, of beneficial interest in the Trust (the “Shares”) if all awards granted under the Plan were Full Value Awards (as defined below) and 21,600,000 Shares if all awards granted under the Plan were not Full Value Awards (which includes the number of Shares remaining under the Predecessor Plan as of April 5, 2023). The Shares issued under the Plan may be authorized and unissued Shares, as the Trust may from time to time determine. Any Shares that are subject to awards that are not Full Value Awards shall be counted against the number of Share Equivalents available for the grant of awards under the Plan, as set forth in the first sentence of this Section 2, as one-half Share Equivalent for every Share granted pursuant to an award; any Shares that are subject to awards that are Full Value Awards shall be counted as one Share Equivalent for every Share granted pursuant to an award. “Share Equivalent” shall be the measuring unit for purposes of the Plan to determine the number of Shares that may be subject to awards hereunder, which number of Shares shall not in any event exceed 21,600,000, subject to the provisions of this Section 2 or any adjustment in the kind and number of securities as provided in Section 18. For the avoidance of doubt, if the Trust issues any dividend or distribution to shareholders of the Trust in the form of another equity security of the Trust during the term of this Plan, then the Share Equivalents that may be subject to awards hereunder, including as a result of an adjustment or substitution pursuant to Section 18, shall include (i) the Share Equivalents then-remaining for issuance and (ii) an amount of such other equity securities of the Trust as would have been issued as a dividend or distribution in respect of such Share Equivalents had they been outstanding. “Full Value Award” means an award under the Plan other than a stock option, stock appreciation right or other award that does not deliver on the grant date of such award the full value of the underlying Shares or underlying OP Units. “OP Units” are undivided fractional limited partnership interests in Vornado Realty L.P. (together with any successor entity, the “Operating Partnership”), of one or more classes established pursuant to the Operating Partnership’s agreement of limited partnership, as amended from time to time. The Operating Partnership is a Delaware limited partnership, the entity through which the Trust conducts its business and an entity that has elected to be treated as a partnership for federal income tax purposes. The Compensation Committee (the “Committee”) of the Board of Trustees of the Trust (the “Board of Trustees”) may, without affecting the number of Share Equivalents available pursuant to this Section 2, authorize the issuance or assumption of benefits under the Plan in connection with any merger, consolidation, acquisition of property or stock, reorganization or similar transaction upon such terms and conditions as it may deem appropriate, subject to compliance with Section 409A of the Code (“Section 409A”) and any other applicable provisions of the Internal Revenue Code of 1986, as amended (the “Code”).
6.Relationships with organizations to which the Trust owes money. A Trustee's or his immediate family member's status as an executive officer or employee of an organization to which the Trust was indebted at the end of the Trust's most recent fiscal year so long as that total amount of indebtedness is not in excess of 5% of the Trust's total consolidated assets.
7.Relationships with organizations that owe money to the Trust. A Trustee's or his immediate family member's status as an executive officer or employee of an organization which is indebted to the Trust at the end of the Trust's most recent fiscal year so long as that total amount of indebtedness is not in excess of 15% of the organization's total consolidated assets.
8.Personal indebtedness to the Trust. A Trustee's or his immediate family member's being indebted to the Trust at any time since the beginning of the Trust's most recently completed fiscal year so long as such amount does not exceed the greater of:
(i)$1 million; or
(ii)2% of the individual's net worth.
9.Leasing or retaining space from the Trust. The leasing or retaining of space from the Trust by:
(i)a Trustee;
(ii)a Trustee's immediate family member; or
(iii)an affiliate of a Trustee or an affiliate of a Trustee's immediate family member;
so long as in each case the rental rate and other lease terms are at market rates and terms in the aggregate at the time the lease is entered into or, in the case of a non-contractual renewal, at the time of the renewal.
10.Other relationships that do not involve more than $100,000. Any other relationship or transaction that is not covered by any of the categorical standards listed above and that does not involve payment of more than $100,000 in the most recently completed fiscal year of the Trust.
11.Personal relationships with management. A personal relationship between a Trustee or a Trustee's immediate family member and a member of the Trust's management.
12.Partnership and co-investment relationships between or among Trustees. A partnership or co-investment relationship between or among a Trustee or a Trustee's immediate family member and other members of the Trust's Board of Trustees, including management Trustees, so long as the existence of the relationship has been previously disclosed in the Trust's reports and/or proxy statements filed with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended.
The fact that a particular transaction or relationship falls within one or more of the above categorical standards does not eliminate a Trustee's obligation to disclose the transaction or relationship to the Trust, the Board of Trustees or management as and when requested for public disclosure and other relevant purposes. For relationships that are either not covered by or do not satisfy the categorical standards above, the determination of whether the relationship is material and therefore whether the Trustee qualifies as independent may be made by the Corporate Governance and Nominating Committee or the Board. The Trust shall explain in the annual meeting proxy statement immediately following any such determination the basis for any determination that a relationship was immaterial despite the fact that it did not meet the foregoing categorical standards.
Invitation. The invitation to join the Board should be extended by the Board itself via the Chairman of the Board and CEO of the Trust, together with an independent Trustee, when deemed appropriate.
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OrientationShares subject to an award granted under the Plan that expires unexercised, that is forfeited, terminated or cancelled, in whole or in part, or is paid in cash in lieu of Shares, shall thereafter again be available for grant under the Plan; provided, however, that the number of Share Equivalents that shall again be available for the grant under the Plan shall be increased by one Share Equivalent for each Share that is subject to a Full Value Award at the time such Full Value Award expires or is forfeited, terminated or cancelled and Continuing Education. Management, workingby one-half Share Equivalent for each Share that is subject to an award that is not a Full Value Award at the time such award expires or is forfeited, terminated or cancelled. Awards that use Shares as a reference but that are paid or settled in whole or in part in cash shall not affect the number of Share Equivalents available under the Plan pursuant to this Section 2 to the extent paid or settled in cash. The number of Share Equivalents available for the purpose of awards under the Plan shall be reduced by (i) one-half of the gross number of Shares for which stock options or stock appreciation rights are exercised, regardless of whether any of the Shares underlying such awards are not actually issued as the result of a net settlement or to satisfy any tax withholding obligation and (ii) one Share for each Share withheld to satisfy any tax withholding obligation with respect to any Full Value Award, as described further in Section 15. The maximum aggregate number of Share Equivalents that may be granted under the Plan, as set forth in this Section 2, shall be cumulatively increased from time to time by the number of Shares subject to, or acquired pursuant to, that portion of any award granted under the Predecessor Plan and outstanding as of the Effective Date that, on or after the Effective Date, expires unexercised, that is forfeited, terminated or cancelled, in whole or in part, or is paid in cash in lieu of Shares; provided, however, that the number of Share Equivalents that shall again be available for grant under the Plan shall be increased by one-half Share Equivalent for each Share that is subject to an award granted under the Predecessor Plan that would not have been a Full Value Award if granted under the Plan at the time such award expires or is forfeited, terminated or cancelled. The maximum aggregate number of Shares that may be issued under the Plan pursuant to the exercise of incentive stock options within the meaning of Section 422 of the Code shall not exceed 21,600,000 Shares (as adjusted pursuant to the provisions of Section 18). 3.
Administration The Plan shall be administered by the Committee. Notwithstanding anything to the contrary contained herein, the Board of Trustees may, in its sole discretion, at any time and from time to time, grant awards or administer the Plan. In any such case, the Board of Trustees will provide an orientation process for new Trustees, including background material on the Trust, its business plan and its risk profile, and meetings with senior management. Membershave all of the Board are requiredauthority and responsibility granted to undergo continuing education as recommendedthe Committee herein. Subject to the provisions of the Plan, the Committee shall select the Employees, Non-Employee Trustees and Consultants who will be participants in the Plan (together, the “Participants”). The Committee shall (i) determine the type of awards to be made to Participants, determine the Shares or share units subject to awards, and (ii) have the authority to interpret the Plan, to establish, amend, and rescind any rules and regulations relating to the Plan, to determine the terms and provisions of any agreements entered into hereunder, and to make all other determinations necessary or advisable for the administration of the Plan, based on, among other things, information made available to the Committee by the NYSE. In connection therewith,management of the TrustTrust. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any award in the manner and to the extent it shall deem desirable to carry it into effect. The determinations of the Committee in its administration of the Plan, as described herein, shall be final and conclusive. The Committee’s determinations under the Plan and awards need not be uniform and any such determinations may be made by it selectively among persons who receive, or are eligible to receive, awards under the Plan (whether or not such persons are similarly situated). Without limiting the generality of the foregoing, the Committee will reimbursebe entitled, among other things, to make non-uniform and selective determinations under award agreements and to enter into non-uniform and selective award agreements, as to (a) the persons to receive awards and (b) the provisions of awards. 4.
Eligibility All Employees, Non-Employee Trustees for all reasonable costs associated with the attendance at or the completion of any continuing education program supported, offered or approvedand Consultants, in each case as determined by the NYSE or approved by the Trust.V. Term Limits
The Board does not believe it should establish term limits.
VI. Retirement of Trustees
The Board believes it should not establish a mandatory retirement age.
VII. Board Meetings
The Board currently plans at least four meetings each year, with further meetings to occur (or actionCommittee, are eligible to be taken by unanimous written consent) atParticipants in the discretion of the Board. The meetings will usually consist of committee meetings and the Board meeting.
The agenda for each Board meeting will be established by the Chairman and CEO, with assistance of the Lead Trustee, the Trust's Secretary and internal Corporation Counsel. Any Trustee may suggest the inclusion of additional subjects on the agenda. Management will seek to provide to all Trustees an agenda and appropriate materials in advance of meetings, although the Board recognizes that this will not always be consistent with the timing of transactions and the operations of the business and that in certain cases it may not be possible.
Materials presented to the Board or its committees should be as concise as possible, while still providing adequate information for the Trustees to make an informed judgment.
VIII. Executive Sessions
To ensure free and open discussion and communication among the non-management Trustees, the non-management Trustees will meet in executive sessions periodically, with no members of management present. Non-management Trustees who are not independent under the NYSE Rules may participate in these executive sessions, but the independent Trustees should meet separately in executive session at least once per year.
At any time that the independent Trustees have not appointed a Lead Trustee or the Lead Trustee is not present, the participants in any executive sessions will select by majority vote of those attending a presiding Trustee for such sessions or any such session.
In order that interested parties may be able to make their concerns known to the non-management Trustees, the Trust shall disclose a method for such parties to communicate directly with the Lead Trustee or the non-management Trustees as a group. For the purposes hereof, communication through a third party such as an external lawyer or a third-party vendor who relays information to non-management members of the Board will be considered direct.
IX. The Committees of the Board
The Trust shall have at least the committees required by the NYSE Rules. Currently, these are the Audit Committee, the Compensation Committee and a nominating/corporate governance committee, which in our Trust is called the Corporate Governance and Nominating Committee. Each of these three committees must have a written charter satisfying the rules of the NYSE.
Plan.
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5.
Awards Awards under the Plan may consist of the following: stock options (either incentive stock options within the meaning of Section 422 of the Code or non-qualified stock options), stock appreciation rights, performance shares, grants of restricted stock and other-stock based awards, including OP Units. Awards of performance shares, restricted stock or share units and other-stock based awards may provide the Participant with dividends or dividend equivalents and voting rights prior to vesting (whether based on a period of time or based on attainment of specified performance conditions). Unless the Committee otherwise specifies in the award agreement, if dividends or dividend equivalent rights are granted, (x) dividends and dividend equivalents shall be paid in respect of any award that is not subject to performance vesting conditions to the Participant at the same time as the Trust pays dividends to common shareholders (even if the Shares subject to the underlying award are held by the Trust) but not less than annually and not later than the fifteenth day of the third month following the end of the calendar year in which the dividends or dividend equivalents are credited (or, if later, the fifteenth day of the third month following the end of the calendar year in which the dividends or dividend equivalents are no longer subject to a “substantial risk of forfeiture” within the meaning of Section 409A) and (y) dividend and dividend equivalent payments in the case of an award that is subject to performance vesting conditions shall be treated as unvested so long as such award remains unvested, and any such dividend and dividend equivalent payments that would otherwise have been paid during the vesting period shall instead be accumulated (and, if paid in cash, reinvested in additional Shares based on the Surrender Value of the Shares on the date of reinvestment) and paid within 30 days following the date on which such award is determined by the Committee to have satisfied such performance vesting conditions. “Surrender Value” means, with respect to a Share, the closing price reported for the Shares on the applicable date as reported on the New York Stock Exchange or, if not so reported, as determined in accordance with a valuation methodology approved by the Committee in a manner consistent with Section 409A, unless determined as otherwise specified herein. Notwithstanding any other provision of the Plan to the contrary and except for acceleration in the event of the Participant’s involuntary termination, retirement, death, disability or hardship (as determined by the Committee) or upon a Change in Control (as defined in Section 13), (1) Full Value Awards (a) that vest on the basis of the Participant’s continued employment or service shall be subject to a minimum vesting schedule of at least one year and (b) that vest on the basis of the attainment of performance goals shall provide for a performance period that ends no earlier than the first anniversary of the commencement of the period over which performance is evaluated; and (2) awards that are not Full Value Awards may not vest or be exercisable earlier than the first anniversary of the date on which such award is granted. Notwithstanding the foregoing, awards (x) with respect to 5% of the maximum aggregate number of Share Equivalents available for the purpose of awards under the Plan pursuant to Section 2 or (y) granted to retirement-eligible Participants may be granted under the Plan to any one or more Participants without respect to such minimum vesting provisions. 6.
Operating Partnership Units Awards may be granted under the Plan in the form of OP Units. Awards of OP Units shall be valued by reference to, or otherwise determined by reference to or based on, Shares. OP Units awarded under the Plan may be (1) convertible, exchangeable or redeemable for other limited partnership interests in the Operating Partnership (including OP Units of a different class or series) or Shares, or (2) valued by reference to the book value, fair value or performance of the Operating Partnership. Except as otherwise determined by the Committee, awards of OP Units are intended to qualify as “profits interests” within the meaning of IRS Revenue Procedure 93-27, as clarified by IRS Revenue Procedure 2001-43, with respect to a Participant in the Plan who is rendering services to or for the benefit of the Operating Partnership, including its subsidiaries. For purposes of calculating the number of Shares underlying an award of OP Units relative to the total number of Share Equivalents available for issuance under the Plan, the Committee shall establish in good faith the maximum number of Shares to which a Participant receiving such award of OP Units may be entitled upon fulfillment of all applicable conditions set forth in the relevant award documentation, including vesting conditions, partnership capital account allocations, value accretion factors, conversion ratios, exchange ratios and other similar criteria. If and when any such conditions are no longer capable of being met, in whole or in part, the number of Shares underlying such awards of OP Units shall be reduced accordingly by the Committee, and the number of Share Equivalents available for issuance under the Plan shall be increased by one Share Equivalent for each Share so reduced. Awards of OP Units may be granted either alone or in addition to other awards granted under the Plan. The Committee shall determine the eligible Participants to whom, and the time or times at which, awards of OP
All Trustees, whether members of a committee or not, are invited to make suggestions to a committee chair for additions to the agenda of his or her committee or to request that an item from a committee agenda be considered by the Board. Each committee chair will give a periodic report of his or her committee's activities to the Board.
Each of the Corporate Governance and Nominating Committee, the Audit Committee and the Compensation Committee shall be composed of at least such number of Trustees as may be required by the NYSE Rules who the Board has determined are "independent" under the NYSE Rules. Any additional qualifications for the members of each committee shall be set out in the respective committee's charter. A Trustee may serve on more than one committee for which he or she qualifies.
Each committee may take any action in a meeting of the full Board, and actions of the Board, including the approval of such actions by a majority of the members of the Committee, will be deemed to be actions of that committee. In such circumstance only the votes cast by members of the committee shall be counted in determining the outcome of the vote on matters upon which the committee acts.
X. Management Succession
At least annually, the Board shall review and concur in a succession plan, developed by management, addressing the policies and principles for selecting a successor to the CEO, both in an emergency situation and in the ordinary course of business. The succession plan should include an assessment of the experience, performance, skills and planned career paths for possible successors to the CEO.
XI. Lead Trustee
The independent Trustees will annually elect an independent Trustee to serve as Lead Trustee. The Lead Trustee will serve as a resource to the Chairman and to the other independent Trustees, coordinating the activities of the independent Trustees. The Lead Trustee will perform such other duties and responsibilities as the Board may determine.
The Board has determined that the Lead Trustee should have the following specific duties and responsibilities:
(i)Preside at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent Trustees;
(ii)Serve as liaison between the Chairman and the independent Trustees;
(iii)Consult with the Chairman regarding and approving:
(a)an appropriate schedule of Board meetings;
(b)agenda items; and
(c)materials sent in advance of Board meetings, provided that all Trustees may suggest items for inclusion on the agenda; and
(iv)Call meetings of the independent Trustees when necessary or appropriate.
In addition, if requested by major shareholders, the Lead Trustee will ensure that he or she is available for consultation and direct communication.
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XII. Executive Compensation
Evaluating and Approving CompensationUnits shall be made; the number of OP Units to be awarded; the price, if any, to be paid by the Participant for the CEO. The Board, acting throughacquisition of such OP Units; and the Compensation Committee, annually evaluatesrestrictions and conditions applicable to such award of OP Units. Conditions may be based on continuing employment (or other service relationship), computation of financial metrics (including with reference to the performancebook value of the CEO andOperating Partnership or the Trust against the Trust'svalue of Shares) and/or achievement of pre-established performance goals and objectives, and approves the compensation levelwith related length of the CEO.Evaluatingservice period for vesting, minimum or maximum performance thresholds, measurement procedures and Approving Compensation of Management. The Board, acting through the Compensation Committee, evaluates and approves the proposals for overall compensation policies applicable to executive officers.
XIII. Board Compensation
The Board should conduct a review at least once every three yearslength of the componentsperformance period to be established by the Committee at the time of grant, in its sole discretion. The Committee may allow awards of OP Units to be held through a limited partnership, or similar “look-through” entity, and amountthe Committee may require such limited partnership or similar entity to impose restrictions on its partners or other beneficial owners that are not inconsistent with the provisions of Trustee compensationthis
Section 6. Notwithstanding Section 5 of the Plan, the award agreement or other award documentation in relationrespect of an award of OP Units may provide that the recipient of an award under this Section 6 shall be entitled to receive, currently or on a deferred or contingent basis, dividends or dividend equivalents with respect to the number of Shares underlying the award or other similarly situated companies. Trustee compensation shoulddistributions from the Operating Partnership prior to vesting (whether based on a period of time or based on attainment of specified performance conditions), as determined at the time of grant by the Committee, in its sole discretion, and the Committee may provide that such amounts (if any) shall be consistent with market practices but shoulddeemed to have been reinvested in additional Shares or OP Units. OP Units awarded under this Section 6 may be issued for no cash consideration. 7.
Stock Options The Committee shall establish the option price per Share at the time each stock option is granted, which price shall not be setless than 100% of the Fair Market Value (as defined below) of a Share. Stock options shall be exercisable for such period as specified by the Committee but in no event may options be exercisable more than ten years after their date of grant. The option price of each Share as to which a stock option is exercised shall be paid in full at the time of such exercise. Such payment shall be made (i) in cash, (ii) by tender of Shares owned by the Participant valued at Surrender Value as of the date of exercise, (iii) to the extent approved by the Committee in its sole discretion, by surrender of all or part of the Shares issuable upon exercise of the option by the largest whole number of Shares with a levelSurrender Value that would call into questiondoes not exceed the Board's objectivity.XIV. Prohibition on Short Sales
In accordance with Federal securities laws,aggregate exercise price;
provided, however, that the Trust should prohibit short sales by its executive officersshall accept a cash or other payment from the Participant to the extent of its equity securities.XV. Expectations of Trustees
The business and affairsany remaining balance of the Trust are managed underaggregate exercise price not satisfied by such reduction in the directionnumber of whole Shares to be issued, (iv) in such other consideration as the Committee deems appropriate, or (v) by a combination of cash, Shares and such other consideration.
For purposes of the BoardPlan, “Fair Market Value” means, with respect to a Share, the average of the high and the low prices reported for the Shares on the applicable date as reported on the New York Stock Exchange or, if not so reported, as determined in accordance with Maryland law. In performing his or her duties,a valuation methodology approved by the primary responsibility of each Trustee is to exercise his or her business judgmentCommittee in a manner he or she reasonably believes to be in the best interestsconsistent with Section 409A, unless determined as otherwise specified herein. For purposes of the Trust. The Board has developedgrant of any award, the following specific expectations of Trusteesapplicable date will be the trading day on which the award is granted or, if the date the award is granted is not a trading day, the trading day immediately prior to promote the discharge of this responsibility anddate the efficient conductaward is granted. For purposes of the Board's business.Commitmentexercise of any award, the applicable date is the date a notice of exercise is received by the Trust or, if such date is not a trading day, the trading day immediately following the date a notice of exercise is received by the Trust.
8.
Stock Appreciation Rights Stock appreciation rights may be granted in tandem with a stock option, in addition to a stock option, or may be freestanding and Attendance. All independent and management Trustees should make every reasonable effortunrelated to attend meetings of the Board and meetings of committees of which they are members. Membersa stock option. Stock appreciation rights granted in tandem with or in addition to a stock option may attend by telephone or similar communications equipment if all persons participating in the meeting can hear each otherbe granted either at the same time as the stock option or at a later time. The Board may act by unanimous written consent in lieuCommittee shall establish the grant price of a meeting.Participation in Meetings. Each Trustee shouldeach stock appreciation right granted at the time each such stock appreciation right is granted, which price shall not be sufficiently familiar with the businessless than 100% of the Trust, including its financial statements and capital structure, and the risks and competition it faces, to facilitate active and effective participation in the deliberationsFair Market Value of the Board andShares subject to such award. No stock appreciation right shall be exercisable later than 10 years from the grant date of each committee on which he or she serves. Upon request, management will make appropriate personnel availablesuch award. A stock appreciation right shall entitle the Participant to answer any questions a Trustee may have about any aspectreceive from the Trust an amount equal to the increase of the Trust's business. Trustees should also review the materials provided by management and advisors in advanceFair Market Value of the meetingsShares on the exercise of the Boardstock appreciation right over the grant price. The Committee, in its sole discretion, shall determine whether the stock appreciation right shall be settled in cash, Shares or a combination of cash and its committees and should arrive prepared to discuss the issues presented.
Loyalty and Ethics. Each Trustee should act in good faith. This duty mandates that the best interests of the Trust take precedence over any interests of a Trustee.
The Trust has adopted a Code of Business Conduct and Ethics (the "Code"), including a compliance program to enforce the Code. Certain portions of the Code deal with activities of Trustees, particularly with respect to transactions in securities of the Trust, potential conflicts of interest, the taking of corporate opportunities for personal use, and competing with the Trust. Each Trustee should be familiar with the Code's provisions in these areas and should consult with any member of the Trust's Corporate Governance and Nominating Committee or the Trust's internal Corporation Counsel in the event of any concerns. The Corporate Governance and Nominating Committee is ultimately responsible for applying the Code to specific situations and has the authority to interpret the Code in any particular situation.
Shares.
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9.
Performance Shares Performance shares may be granted in the form of actual Shares or share units having a value equal to an identical number of Shares. In the event that a certificate is issued in respect of Shares subject to a grant of performance shares, such certificate shall be registered in the name of the Participant but shall be held by the Trust until the time the Shares subject to the grant of performance shares are earned. The performance conditions and the length of the performance period shall be determined by the Committee subject to the terms of the Plan. The Committee, in its sole discretion, shall determine whether performance shares granted in the form of share units shall be paid in cash, Shares, or a combination of cash and Shares. 10.
Restricted Stock Restricted stock may be granted in the form of actual Shares or share units having a value equal to an identical number of Shares. In the event that a certificate is issued in respect of Shares subject to a grant of restricted stock, such certificate shall be registered in the name of the Participant but shall be held by the Trust until the end of the restricted period. The employment conditions and the length of the period for vesting of restricted stock shall be established by the Committee at time of grant. The Committee, in its sole discretion, shall determine whether restricted stock granted in the form of share units shall be paid in cash, Shares, or a combination of cash and Shares. 11.
Other Stock-Based Awards Other types of equity-based or equity-related awards (including the grant or offer for sale of unrestricted Shares) may be granted under such terms and conditions as may be determined by the Committee in its sole discretion. 12.
Award Agreements Each award under the Plan shall be evidenced by an agreement setting forth the terms and conditions, as determined by the Committee, which shall apply to such award, in addition to the terms and conditions specified in the Plan. 13.
Change in Control In the event of a Change in Control, after consideration of the requirements of Section 409A,the Committee may take one or more of the following actions with respect to outstanding awards, in its sole discretion: (i) settle such awards for an amount (as determined in the sole discretion of the Committee) of cash or securities, where in the case of stock options and stock appreciation rights, the value of such amount, if any, will be equal to the in-the-money spread value (if any) of such awards; (ii) provide for the assumption of or the issuance of substitute awards that will substantially preserve the otherwise applicable terms of any affected awards previously granted under the Plan, as determined by the Committee in its sole discretion; (iii) modify the terms of such awards to add events, conditions or circumstances (including termination of employment within a specified period after a Change in Control) upon which the vesting of such awards or lapse of restrictions thereon will accelerate; (iv) deem any performance conditions satisfied at target, maximum or actual performance through closing or provide for the performance conditions to continue (in accordance with their terms or as adjusted by the Committee) after the Change in Control or (v) provide that for a period of at least 20 days prior to the Change in Control, any stock options or stock appreciation rights that would not otherwise become exercisable prior to the Change in Control will be exercisable as to all Shares subject thereto (but any such exercise will be contingent upon and subject to the occurrence of the Change in Control and if the Change in Control does not take place within a specified period after giving such notice for any reason whatsoever, the exercise will be null and void) and that any stock options or stock appreciation rights not exercised prior to the consummation of the Change in Control will terminate and be of no further force and effect as of the consummation of the Change in Control. In the event that the consideration paid in the Change in Control includes contingent value rights, earn-out or indemnity payments or similar payments, then the Committee will determine if awards settled under clause (i) above are (a) valued at closing taking into account such contingent consideration (with the value determined by the Committee in its sole discretion) or (b) entitled to a share of such contingent consideration. For the avoidance of doubt, in the event of a Change in Control where all stock options and stock appreciation rights are settled for an amount (as determined in the sole discretion of the Committee) of cash or securities, the Committee may, in its sole discretion, terminate any stock option or stock appreciation right for which the exercise price is equal to or exceeds the per share value of the consideration to be paid in the Change in Control transaction without payment of consideration therefor.
Other Directorships. The Board values the experience Trustees bring from other boards on which they serve, but recognizes that those boards may also present demands on a Trustee's time and availability and may present conflicts or legal issues. A Trustee should advise the Chairman of the Corporate Governance and Nominating Committee and the CEO before accepting membership on other boards of directors or other significant commitments involving affiliation with other businesses or governmental units.
Contact with Management. Trustees have complete access to senior management and management information. Management will be responsive to requests for information from Trustees. The Board encourages the Chief Executive Officer, from time to time, to bring to Board meetings managers who can provide additional insight into the items being discussed. Any other meetings or contacts with officers or employees that a Trustee wishes to initiate may be arranged through the Chief Executive Officer or the Corporate Secretary or directly by the Trustee. The Trustees will use their judgment to ensure that any such contact is not disruptive to the business operations of the Trust, and will, to the extent not inappropriate, copy the Chief Executive Officer on any written communications between a Trustee and an officer or employee of the Trust.
Contact with Other Constituencies. It is important that the Trust speaks to employees and outside constituencies with a single voice, and that management serve as the primary spokesperson.
Confidentiality. The proceedings and deliberations of the Board and its committees are confidential. Each Trustee shall maintain the confidentiality of information received in connection with his or her service as a Trustee.
XVI. Evaluating Board Performance
The Board, acting through the Corporate Governance and Nominating Committee, should conduct a self-evaluation at least annually to determine whether it is functioning effectively. The Corporate Governance and Nominating Committee should periodically consider the mix of skills and experience that Trustees bring to the Board to assess whether the Board has the necessary tools to perform its oversight function effectively.
Each committee of the Board should conduct a self-evaluation at least annually and report the results to the Board, acting through the Corporate Governance and Nominating Committee. Each committee's evaluation must compare the performance of the committee with the requirements of its written charter, if any.
XVII. Reliance on Management and Outside Advice
In performing its functions, the Board is entitled to rely on the advice, reports and opinions of management, counsel, accountants, auditors and other expert advisors. The Board has the authority to retain and approve the fees and retention terms of its outside advisors.
XVIII. Trustee Resignation Policy
The Bylaws of the Trust provide that a nominee for election as a Trustee is elected by a plurality of votes cast. Notwithstanding such vote requirement, any nominee in an uncontested election who does not receive a greater number of "for" votes than votes "withhold" shall be elected as a Trustee but shall promptly tender to the Board his or her offer of resignation from the Board following certification of the vote. A contested election is one in which (i) the Secretary of the Trust receives a notice pursuant to these Bylaws that a shareholder intends to nominate a person or persons for election and (ii) such proposed nomination has not been withdrawn by such shareholder on or prior to the tenth day preceding the date on which the Trust first mails its notice of meeting for such meeting to the shareholders. The Corporate Governance and Nominating Committee shall consider the offer to resign and shall recommend to the Board the action to be taken in response to the offer. In determining its recommendation to the Board, the Corporate Governance and Nominating Committee may consider all factors deemed relevant by the members of the Corporate Governance and Nominating Committee, which may include, without limitation, (i) the stated reason or reasons, if any, why shareholders withheld votes for such Trustee's election, (ii) the qualifications of the Trustee (including, for example, whether the Trustee serves on the Audit Committee of the Board as an "audit
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committee financial expert" and whether there are
Unless otherwise set forth in an award agreement, a “Change in Control” of the Trust means the occurrence of one or more other Trustees qualified, eligible and available to serveof the following events: (i)individuals who, on the Audit Committee in such capacity), (iii) whetherdate hereof, constitute the resignation would causeBoard of Trustees (the “Incumbent Trustees”) cease for any reason to constitute at least a majority of the Board of Trustees, provided that any person becoming a trustee subsequent to the date hereof whose election or nomination for election was approved by a vote of at least two-thirds of the Incumbent Trustees then on the Board of Trustees (either by a specific vote or by approval of the proxy statement of the Trust in which such person is named as a nominee for trustee, without objection to such nomination) shall be in violation of any of its constituent documents, any legalan Incumbent Trustee; provided, however, that no individual initially elected or regulatory requirements, agreements, or the rules of any national securities exchange on which its securities are then listed, and (iv) whether the Trustee's resignation from the Board would be in the best interestsnominated as a trustee of the Trust. The Corporate Governance and Nominating Committee also may consider a range of possible alternatives concerning the Trustee's offer to resign as the members of the Corporate Governance and Nominating Committee deem appropriate. In considering the Committee's recommendation, the Board may consider the information, factors and alternatives considered by the Committee and such additional information, factors and alternatives as the Board deems relevant. Each Trustee, whether actingTrust as a memberresult of the Corporate Governance and Nominating Committeean actual or threatened election contest with respect to trustees or as a memberresult of any other actual or threatened solicitation of proxies by or on behalf of any person other than the Board may giveof Trustees shall be an Incumbent Trustee; (ii)any “person” (as such weight to anyterm is defined in Section 3(a)(9) of the foregoing factors as he or she deems appropriate.The Board shall take action no later than the next regularly scheduled Board meeting to be held no earlier than ten days after the date of the election, unless such action would cause the Trust to fail to comply with any requirement of the New York Stock Exchange or any rule or regulation promulgated under the Securities Exchange Act of 1934 (the “
Exchange Act”) and as used in which eventSections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes, after the date hereof, a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Trust representing 30% or more of the combined voting power of the Trust’s then outstanding securities eligible to vote for the election of the Board of Trustees (the “Trust Voting Securities”); provided, however, that an event described in this paragraph (ii) shall take action not be deemed to be a Change in Control if any of following becomes such a beneficial owner: (A) the Trust or any majority-owned subsidiary of the Trust (provided that this exclusion applies solely to the ownership levels of the Trust or the majority-owned subsidiary), (B) any tax-qualified, broad-based employee benefit plan sponsored or maintained by the Trust or any such majority-owned subsidiary, (C) any underwriter temporarily holding securities pursuant to an offering of such securities, (D) any person pursuant to a Non-Qualifying Transaction (as defined in paragraph (iii)), (E) (a) any of the partners (as of the date hereof) in Interstate Properties including immediate family members and family trusts or family-only partnerships and any charitable foundations of such partners (the “Interstate Partners”), (b) any entities the majority of the voting interests of which are beneficially owned by the Interstate Partners, or (c) any “group” (as promptlydescribed in Rule 13d-5(b)(1) under the Exchange Act) including the Interstate Partners (the persons in (a), (b) and (c) shall be individually and collectively referred to herein as “Interstate Holders”); or (iii)the consummation of a merger, consolidation, share exchange or similar form of transaction involving the Trust or any of its subsidiaries, or the sale of all or substantially all of the Trust’s assets (a “Business Transaction”), unless immediately following such Business Transaction (a) more than 50% of the total voting power of the entity resulting from such Business Transaction or the entity acquiring the Trust’s assets in such Business Transaction (the “Surviving Corporation”) is practicable while continuingbeneficially owned, directly or indirectly, by the Interstate Holders or the Trust’s shareholders immediately prior to meetany such requirements. The Business Transaction, and (b) no person (other than the persons set forth in clauses (A), (B), (C), or (E) of paragraph (ii) above or any tax-qualified, broad-based employee benefit plan of the Surviving Corporation or its affiliates) beneficially owns, directly or indirectly, 30% or more of the total voting power of the Surviving Corporation (a “Non-Qualifying Transaction”); or (iv)Board will promptly disclose its decisionof Trustees approval of a liquidation or dissolution of the Trust, unless the voting common equity interests of an ongoing entity (other than a liquidating trust) are beneficially owned, directly or indirectly, by the Trust’s shareholders in substantially the same proportions as such shareholders owned the Trust Voting Securities immediately prior to such liquidation and such ongoing entity assumes all existing obligations of the Trust to Participants under this Plan and the reasons therefor in a Form 8-K furnishedaward agreements issued thereunder. 14.
Clawback/Forfeiture Awards granted under the Plan will be subject to the Securities and Exchange Commission.No Trustee whose offerrequirement that the awards be forfeited or repaid to resign,the Trust after they have been distributed to the Participant (i) to the extent set forth in accordance with thisan award agreement or (ii) to the extent covered by (A) any clawback or recapture policy is requiredadopted by the Trust from time to time or (B) any applicable laws that impose mandatory forfeiture or recoupment, under circumstances set forth in such applicable laws.
15.
Withholding The Trust shall have the right to deduct from any payment to be considered by the Board shall participate in the Corporate Governance and Nominating Committee's deliberations or recommendation, or in the Board's deliberations or determination, with respect to accepting or rejecting his or her offer to resign as a Trustee.If each member of the Corporate Governance and Nominating Committee is required to offer to resignmade pursuant to this policy, the Board may appoint a special committee composed of Trustees who are not so requiredPlan, or to offer to resign to consider the offers to resign and recommendrequire prior to the Board whetherissuance or delivery of any Shares or the payment of cash under the Plan, any taxes required by law to accept any or all of them. In the event that every Trustee is required to offer to resign pursuant to this policy, the Board shall make a final determination whether to accept any or all offers to resign.
If the offer to resign is not accepted, the Trustee will continue to serve until the expiration of his or her term and his or her successor is duly elected and qualifies or until the Trustee's earlier resignation or removal.
be
| | | | | | | | | | | | | | | | | | | | | | | 2016 PROXY STATEMENT | | | | VORNADO REALTY TRUST | | | | 6997 | | |
withheld therefrom. The Committee, in its sole discretion, may permit a Participant who is an employee of the Trust or its subsidiaries to elect to satisfy such withholding obligation by having the Trust retain the number of Shares (rounded up to the nearest whole number unless the Committee determines otherwise) whose Fair Market Value equals the amount of taxes required by applicable law to be withheld, as determined by the Trust. 16.
Nontransferability No award under the Plan shall be assignable or transferable except by will or the laws of descent and distribution, and no right or interest of any Participant shall be subject to any lien, obligation or liability of the Participant. Notwithstanding the foregoing, the Committee may determine, at the time of grant or thereafter, that an award (other than stock options intended to be incentive stock options within the meaning of Section 422 of the Code) is transferable by the Participant to such Participant’s immediate family members (or trusts, partnerships, or limited liability companies established for such immediate family members). For this purpose, immediate family member means, except as otherwise defined by the Committee, the Participant’s children, stepchildren, grandchildren, parents, stepparents, grandparents, spouse, siblings (including half brothers and sisters), in-laws and persons related by reason of legal adoption. Such transferees may transfer an award only by will or the laws of descent or distribution. An award transferred pursuant to this Section 16 shall remain subject to the provisions of the Plan, and shall be subject to such other rules as the Committee shall determine. Upon transfer of a stock option, any related stock appreciation right shall be canceled. Except in the case of a holder’s incapacity, an award shall be exercisable only by the holder thereof. 17.
No Right to Employment No person shall have any claim or right to be granted an award, and the grant of an award shall not be construed as giving a Participant any right to continue his or her service to the Trust or its subsidiaries as an Employee, Non-Employee Trustee or Consultant. Further, the Trust and its subsidiaries expressly reserve the right at any time to dismiss a Participant free from any liability, or any claim under the Plan, except as provided herein or in any agreement entered into hereunder. 18.
Adjustment of and Changes in Shares In the event of any change in the outstanding Shares by reason of any share dividend or split, reverse split, reclassification, recapitalization, merger, consolidation, spinoff, combination or exchange of Shares or other corporate change, or any distributions to shareholders other than regular cash dividends (including, without limitation, a distribution of common or preferred shares of beneficial interest of the Trust), the Committee shall make such substitution or adjustment, if any, as it deems to be equitable, as to (i) the kinds of common shares, preferred shares or other securities of the Trust, and the number of Share Equivalents, for which awards may be granted under the Plan, (ii) the number and kinds of Shares, common shares, preferred shares or other securities issued or reserved for issuance pursuant to outstanding awards, and (iii) the number and kinds of Shares or other common shares set forth in Section 2 that can be issued through incentive stock options within the meaning of Section 422 of the Code; provided, however, that no such substitution or adjustment shall be required if the Committee determines that such action could cause an award to fail to satisfy the conditions of an applicable exception from the requirements of Section 409A or otherwise could subject a Participant to the additional tax imposed under Section 409A in respect of an outstanding award; and further provided that no Participant shall have the right to require the Committee to make any adjustment or substitution under this Section 18 or have any claim or right whatsoever against the Trust or any of its subsidiaries or affiliates or any of their respective trustees, directors, officer or employees in respect of any action taken or not taken under this Section 18. 19.
Amendment; Termination The Committee may amend or terminate the Plan or any portion thereof from time to time, provided that no amendment shall be made without shareholder approval if such amendment (i) would increase the maximum aggregate number of Shares that may be issued under the Plan (other than pursuant to Section 18), (ii) would materially expand the class of service providers eligible to participate in the Plan, (iii) would result in a material increase in the benefits accrued to Participants under the Plan, (iv) would reduce the exercise price of outstanding stock options or stock appreciation rights or cancel outstanding stock options or stock appreciation rights in exchange for cash, other awards or stock options or stock appreciation rights with an exercise price that is less than the exercise price of the original stock options or stock appreciation rights (other than pursuant to Section 18) or (v) requires shareholder approval to comply with any applicable laws, regulations or rules, including the rules of
ANNEX B
VORNADO REALTY TRUST
ARTICLES OF AMENDMENT
Vornado Realty Trust, a Maryland real estate investment trust (the "Company"), hereby certifies to the State Department of Assessments and Taxation of Maryland that:
FIRST: The Declaration of Trust of the Company (the "Declaration") is hereby amended by deleting Section 2.2 in its entirety and inserting the following in lieu thereof:
The Trustees elected at the 2016 annual meeting of Shareholders shall serve until the 2019 annual meeting of Shareholders and until their respective successors are duly elected and qualify. At the 2017 annual meeting of Shareholders, each of the successors to the Trustees whose terms expire at the 2017 annual meeting of Shareholders shall be elected to serve until the 2018 annual meeting of Shareholders and until their respective successors are duly elected and qualify. At the 2018 annual meeting of Shareholders, each of the successors to the Trustees whose terms expire at the 2018 annual meeting of Shareholders shall be elected to serve until the 2019 annual meeting of Shareholders and until their respective successors are duly elected and qualify. Beginning with the 2019 annual meeting of Shareholders, all Trustees shall be elected to serve until the next annual meeting of Shareholders and until their respective successors are duly elected and qualify.
SECOND: The amendment to the Declaration as set forth above has been duly advised by the Board of Trustees of the Company and approved by the shareholders of the Company as required by law.
THIRD: The undersigned officer acknowledges these Articles of Amendment to be the trust act of the Company and, as to all matters of facts required to be verified under oath, the undersigned officer acknowledges that, to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.
[SIGNATURE PAGE FOLLOWS]
| | | | | | | | | | | | | | | | | | | | | | | | 70 | | | | VORNADO REALTY TRUST | | |
a securities exchange or self-regulatory agency. Notwithstanding anything contrary in this Plan, if there is a change in applicable tax law such that OP Units become taxable to the holder of such OP Units as ordinary income, the Operating Partnership, at any time in the sole discretion of the general partner of the Operating Partnership, may cause the OP Units to be restructured and/or substituted for other awards in a way that permits a tax deduction to the Operating Partnership or the Trust while preserving substantially similar pre-tax economics to the holder of such OP Units. 20.
Section 409A It is the Trust’s intent that awards under the Plan be exempt from, or comply with, the requirements of Section 409A, and that the Plan be administered and interpreted accordingly. Without limiting the generality of the foregoing, if and to the extent that any award made under the Plan is determined by the Trust to constitute “non-qualified deferred compensation” subject to Section 409A then: (i)Any payment due by reason of the Participant’s termination of employment, then (i) such payment or benefit shall be made or provided to the Participant only upon a “separation from service” as defined for purposes of Section 409A under applicable regulations and (ii) if the Participant is a “specified employee” (within the meaning of Section 409A and as determined by the Trust), such payment or benefit shall not be made or provided before the date that is six months after the date of the Participant’s separation from service (or the Participant’s earlier death); (ii)Any payment due upon a Change in Control will be paid only if such Change in Control constitutes a “change in ownership” or “change in effective control” within the meaning of Section 409A, and in the event that such Change in Control does not constitute a “change in the ownership” or “change in the effective control” within the meaning of Section 409A, such Award will vest upon the Change in Control and any payment will be delayed until the first compliant date under Section 409A; (iii)If the award includes a “series of installment payments” (within the meaning of Section 1.409A-2(b)(2)(iii) of the Treasury Regulations), the participant’s right to the series of installment payments will be treated as a right to a series of separate payments and not as a right to a single payment; and (iv)If the award includes dividend equivalents, the participant’s right to the dividend equivalents will be treated separately from the right to other amounts under the award. 21.
Governing Law The Plan and all awards made and actions taken thereunder will be governed by and construed in accordance with the laws of the state of Maryland, without reference to principles of conflict of laws. 22.
Effective Date; Term The Plan was adopted by the Board of Trustees on February 9, 2023, and shall be effective as of the date of the approval by the requisite shareholders of the Trust at the 2023 Annual Meeting on May 18, 2023 (the “Effective Date”). If the Plan is not so approved by the requisite shareholders of the Trust, then the Plan will be null and void in its entirety and the Predecessor Plan will remain in full force and effect with respect to awards to be granted to Employees and Consultants. Subject to earlier termination pursuant to Section 19, the Plan shall have a term of ten years from the Effective Date; provided, however, that all awards made under the Plan before its termination, and the Committee’s authority to administer the terms of such awards, will remain in effect until such awards have been satisfied or terminated in accordance with the terms and provisions of the Plan and the applicable award agreements.
| | | 2016 PROXY STATEMENT | VORNADO REALTY TRUST | | | | | | | | 99 | | |
IN WITNESS WHEREOF, the Company has caused these Articles of Amendment to be signed in its name and on its behalf by its and attested to by its Secretary on this day of , 2016.
Appendix Defined Terms | Term | | | Section | | | Board of Trustees | | | 2 | | | Business Transaction | | | 13 | | | Change in Control | | | 13 | | | Code | | | 2 | | | Committee | | | 2 | | | Consultants | | | 1 | | | Effective Date | | | 22 | | | Employees | | | 1 | | | Exchange Act | | | 13 | | | Fair Market Value | | | 7 | | | Full Value Award | | | 2 | | | Incumbent Trustees | | | 13 | | | Interstate Holders | | | 13 | | | Interstate Partners | | | 13 | | | Non-Employee Trustees | | | 1 | | | Non-Qualifying Transaction | | | 13 | | | OP Units | | | 2 | | | Operating Partnership | | | 2 | | | Participants | | | 3 | | | Plan | | | 1 | | | Predecessor Plan | | | 1 | | | Section 409A | | | 2 | | | Share | | | 2 | | | Share Equivalent | | | 2 | | | Surrender Value | | | 5 | | | Surviving Corporation | | | 13 | | | Trust | | | 1 | | | Trust Voting Securities | | | 13 | |
| | | | | ATTEST: | | VORNADO REALTY TRUST |
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888 Seventh Avenue, New York, New York 10019
![[MISSING IMAGE: px_01page-bw.jpg]](/files/DEF 14A/0001104659-23-043150/px_01page-bw.jpg) SCAN TOVIEW MATERIALS & VOTE w SCAN TO VORNADOVOTEVORNADO REALTY TRUST 888 SEVENTH AVENUE NEW YORK, NY 10019 VOTE10019VOTE BY INTERNETINTERNETBefore The Meeting - Go to www.proxyvote.com or scan the QR Barcode above UseaboveUse the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date.on May 17, 2023. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would likeform.During The Meeting - Go to reducewww.virtualshareholdermeeting.com/VNO2023You may attend the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronicallymeeting via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and when prompted, indicatevote during the meeting. Have the information that you agree to receive or access proxy materials electronicallyis printed in future years. VOTEthe box marked by the arrow available and follow the instructions.VOTE BY PHONE - 1-800-690-6903 Use1-800-690-6903Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date.on May 17, 2023. Have your proxy card in hand when you call and then follow the instructions. VOTEinstructions.VOTE BY MAIL Mark,MAILMark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. TO11717.TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: E02049-P72571 KEEPV02056-P87253KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY THISRECORDSTHIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. VORNADODATED.DETACH AND RETURN THIS PORTION ONLYVORNADO REALTY TRUST The Boar d of Trustees r ecommends you vote FOR the following: For Withhold AllAll For All Except ToTRUSTFor WithholdFor AllTo withhold authority to vote for any individual nominee(s)individualThe Board of Trustees recommends you vote FOR the following:All AllExceptnominee(s), mark “For"For All Except”Except" and write the number(s) of the nominee(s) on the line below.below.1. Election of TrusteesNominees:01) Steven Roth02) Candace K. Beinecke03) Michael D. Fascitelli04) Beatrice Hamza Bassey05) William W. Helman IV! ! ! ! 1. Election of Trustees Nominees: 01) 02) 03) Candace K. Beinecke Robert P. Kogod Richard06) David M. Mandelbaum07) Raymond J. McGuire08) Mandakini Puri09) Daniel R. West TheTisch10) Russell B. Wight, Jr.The Board of Trustees recommends you vote FOR proposals 2 3 and 4.3. For Against Abstain ! ! ! ! ! ! ! ! ! 2.Abstain2. RATIFICATION OF THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE COMPANY'S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE! ! !THE CURRENT FISCAL YEAR. APPROVAL OF AN AMENDMENT TO THE DECLARATION OF TRUST TO ELIMINATE THE CLASSIFICATION OF THE BOARD OF TRUSTEES. 3.YEAR.3. NON-BINDING, ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION. ! ! !The Board of Trustees recommends a vote of "1 Year" for proposal 4. 1 Year 2 Years 3 Years Abstain4. NON-BINDING, ADVISORY VOTE TO APPROVEON THE FREQUENCY OF EXECUTIVE COMPENSATION. NOTE:COMPENSATION ADVISORY VOTES.! ! ! !The Board of Trustees recommends you vote FOR proposal 5. For Against Abstain5. APPROVAL OF THE COMPANY'S 2023 OMNIBUS SHARE PLAN.! ! !NOTE: SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY POSTPONEMENT OR ADJOURNMENT THEREOF. ! For address changes and/or comments, please check this box and write them on the back where indicated. PleaseTHEREOF.Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. Signatureofficer.Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:The Notice and Proxy Statement and Form 10-KAnnual Report are available at www.proxyvote.com. E02050-P72571 VORNADOwww.proxyvote.com.VORNADO REALTY TRUST This proxyTRUSTThis Proxy is solicited on behalf of the Board of Trustees for the 2016the2023 Annual Meeting of Shareholders May 19, 2016ShareholdersMay 18, 2023 11:30 A.M. TheA.M.The undersigned shareholder, revoking all prior proxies, hereby appoints Steven Roth and Michael D. Fascitelli,J. Franco, or either of them, as proxies forproxiesfor the undersigned, each with full power of substitution, to attend and participate in the Annual Meeting of Shareholders of Vornado Realty Trust, a Maryland real estate investment trust (the "Company"), to be held at the Saddle Brook Marriott, Interstate 80 and the Garden State Parkway, Saddle Brook, New Jersey 07663 on Thursday, May 19, 201618, 2023 at 11:30 A.M., local time,New York Time, and any postponements or adjournments thereof, to cast on behalf of the undersigned all votes that the undersigned is entitled to cast at such meeting and otherwise represent the undersigned at the meeting with all powers possessed by the undersigned if personally present at the meeting. Each proxy is authorized to vote as directed on the reverse side hereof upon the proposals which are more fully set forth in the Proxy Statement and otherwise in his discretion upon such other business as may properly come before the meeting and all postponements or adjournments thereof, all as more fully set forth in the Notice of AnnualofAnnual Meeting of Shareholders and Proxy Statement.Statement, which are incorporated by reference. Receipt of the Notice of Annual Meeting of Shareholders, the Proxy Statement in connection with such meeting and the 20152022 Annual Report to Shareholders is hereby acknowledged. WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER DIRECTED BY THE UNDERSIGNED SHAREHOLDER. IF THIS PROXY IS EXECUTED BUT NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED (1) "FOR" THE ELECTION OF EACH NOMINEE FOR TRUSTEE, (2) "FOR" THE RATIFICATION OF THE SELECTION OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM, (3) "FOR" THE APPROVAL OF AN AMENDMENT TO THE DECLARATION OF TRUST TO ELIMINATE THE CLASSIFICATION OF THE BOARD OF TRUSTEES AND (4) "FOR" THE NON-BINDING, ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION.COMPENSATION, (4) "1 YEAR" FOR THE NON-BINDING, ADVISORY VOTE ON THE FREQUENCY OF EXECUTIVE COMPENSATION, AND (5) "FOR" THE APPROVAL OF THE COMPANY'S 2023 OMNIBUS SHARE PLAN. THE VOTES ENTITLED TO BE CAST BY THE UNDERSIGNED WILL BE CAST IN THE DISCRETION OF THE PROXY HOLDER ON ANY OTHER MATTERS THAT MAY COME BEFORE THE MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF. (If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.) ContinuedTHEREOF.Continued and to be signed on reverse side Address Changes/Comments:
V02057-P87253
QuickLinks
2016 PROXY STATEMENT SUMMARY
Growth in TSR
Advisory Resolution on Executive Compensation
CORPORATE GOVERNANCE GUIDELINES
VORNADO REALTY TRUST ARTICLES OF AMENDMENT
0000899689 4 2022-01-01 2022-12-31
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