SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
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[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
[ ] Confidential, for Use of the Commission Only
Lexington Corporate Properties Trust
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(Name of Registrant as Specified In Its Organizational Documents)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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4) Date Filed:
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LEXINGTON CORPORATE PROPERTIES TRUST
ONE PENN PLAZA, SUITE 4015
NEW YORK, NEW YORK 10119-4015
(212) 692-7200
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 24, 2005
To the Shareholders of
Lexington Corporate Properties Trust:
The 2005 Annual Meeting of Shareholders of Lexington Corporate Properties
Trust (the "Company") will be held at the offices of Paul, Hastings, Janofsky &
Walker LLP, 75 East 55th Street, New York, New York 10022 on Tuesday, May 24,
2005, at 10:00 a.m., Eastern Standard time, for the following purposes:
(1) to elect nine trustees to serve until the 2006 Annual Meeting of
Shareholders;
(2) to consider and vote upon a proposal to approve and adopt the
Articles of Amendment pursuant to which the Company's Declaration of
Trust will be amended to increase the number of authorized common
shares and excess shares which the Company has authority to issue
from 80,000,000 common shares and 40,000,000 excess shares to
160,000,000 common shares and 170,000,000 excess shares; and
(3) to transact such other business as may properly come before the 2005
Annual Meeting.
Only holders (the "Shareholders") of record at the close of business on
March 25, 2005 are entitled to notice of and to vote at the 2005 Annual Meeting
of Shareholders or any adjournments thereof. A list of Shareholders will be
available for inspection during normal business hours at the offices of the
Company located at One Penn Plaza, Suite 4015, New York, New York 10119-4015,
during the ten days preceding the 2005 Annual Meeting of Shareholders.
By Order of the Board of Trustees,
PAUL R. WOOD
Vice President, Chief Accounting
Officer
and Secretary
New York, New York
April 28, 2005
PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN
THE ENVELOPE PROVIDED WHETHER OR NOT YOU PLAN TO ATTEND THE 2005 ANNUAL MEETING.
THE PROXY MAY BE REVOKED BY YOU AT ANY TIME BY WRITTEN NOTICE TO THE COMPANY
PRIOR TO ITS EXERCISE. GIVING YOUR PROXY WILL NOT AFFECT YOUR RIGHT TO VOTE IN
PERSON IF YOU ATTEND THE MEETING AND AFFIRMATIVELY INDICATE YOUR INTENTION TO
VOTE AT SUCH MEETING.
LEXINGTON CORPORATE PROPERTIES TRUST
ONE PENN PLAZA, SUITE 4015
NEW YORK, NEW YORK 10119-4015
(212) 692-7200
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 24, 2005
This Proxy Statement is furnished in connection with the solicitation of
proxies by and on behalf of the Board of Trustees of Lexington Corporate
Properties Trust (the "Company") for use at the 2005 Annual Meeting of
Shareholders, and at any adjournments thereof (the "Annual Meeting"), to be held
on Tuesday, May 24, 2005, at the offices of Paul, Hastings, Janofsky & Walker
LLP, 75 East 55th Street, New York, New York 10022 at 10:00 a.m. Eastern
Standard time. This Proxy Statement and the related proxy card are first being
sent to the holders (the "Shareholders") of common shares of beneficial
interest, par value $0.0001 per share (the "Common Shares") of the Company on or
about April 28, 2005.
Valid proxies will be voted as specified thereon at the Annual Meeting. Any
person giving a Proxy may revoke it by written notice to the Company at any time
prior to its exercise. Attendance at the Annual Meeting will not constitute a
revocation of a proxy unless the Shareholder affirmatively indicates at the
Annual Meeting that such Shareholder intends to vote such Shareholder's shares
in person.
ANNUAL REPORT
The Annual Report to Shareholders and Form 10-K of the Company for the year
ended December 31, 2004, including financial statements audited by KPMG LLP, the
Company's independent registered public accounting firm, and their reports
thereon dated March 15, 2005, are being mailed together with this Proxy
Statement to each Shareholder. Except as specifically incorporated herein by
reference, the Annual Report is not part of the proxy solicitation material.
VOTING SECURITIES
The Shareholders of record of Common Shares of the Company at the close of
business on March 25, 2005 (the "Record Date") are entitled to vote at the
Annual Meeting. On the Record Date, there were outstanding 49,129,396 Common
Shares, each entitled to one vote per share on all matters submitted to a vote
of Shareholders.
Unless contrary instructions are indicated on the Proxy, all Common Shares
represented by valid proxies received pursuant to this solicitation, unless
previously revoked, will be voted at the Annual Meeting FOR each of the
proposals contained herein.
Assuming a quorum is present at the Annual Meeting, (i) the affirmative
vote of the holders of a plurality of the Common Shares cast at the Annual
Meeting will be sufficient to elect each candidate for election as a trustee,
and (ii) the affirmative vote of the holders of a majority of Common Shares
entitled to vote will be sufficient to adopt the Articles of Amendment to the
Company's Declaration of Trust to increase the number of authorized common
shares and excess shares. Therefore, abstentions as to the election of trustees
will not affect the election of the candidates receiving a plurality of the
votes cast. Abstentions as to the proposal to adopt the Articles of Amendment to
the Company's Declaration of Trust and any other proposal will have the same
effect as votes against such proposal. If a Shareholder is a participant in the
Company's Dividend Reinvestment Plan, the proxy card enclosed herewith
represents shares in the participant's account, as well as shares held of record
in the participant's name as part of such plan.
The Company knows of no business, other than that set forth above, to be
presented at the Annual Meeting which would be a proper subject for action by
the Shareholders. If any other matter should be presented at the Annual Meeting
upon which a vote properly may be taken, it is intended that any share
represented by a proxy in the accompanying form will be voted with respect
thereto in accordance with the judgment of the person or persons voting such
shares.
2
SHARE OWNERSHIP OF PRINCIPAL SECURITY HOLDERS,
TRUSTEES AND EXECUTIVE OFFICERS
The following table indicates, as of March 31, 2005, (a) the number of
Common Shares beneficially owned by each person known by the Company to own in
excess of five percent of the outstanding Common Shares, and (b) the percentage
such shares represent of the total outstanding Common Shares. All shares were
owned directly on such date with sole voting and investment power unless
otherwise indicated.
BENEFICIAL OWNERSHIP OF
NAME OF BENEFICIAL OWNER SHARES(1) PERCENTAGE OF CLASS
------------------------ ----------------------- -------------------
Franklin Resources, Inc. ................................ 3,571,480(2) 6.88%
Barclays Global Investors, NA, et. al.................... 2,663,392(3) 5.42%
---------------
(1) For purposes of this table, a person is deemed to have "beneficial
ownership" of any shares as of a given date which such person has the right
to acquire within 60 days after such date. For purposes of computing the
percentage of outstanding shares held by each beneficial owner named above
on a given date, any security which such person or persons has the right to
acquire within 60 days after such date is deemed to be outstanding, but is
not deemed to be outstanding for the purpose of computing the percentage
ownership of any other beneficial owner.
(2) Based on information contained in a Schedule 13G filed with the SEC on
February 14, 2005. According to such Schedule 13G, Franklin Resources, Inc.;
Charles B. Johnson; Rupert H. Johnson, Jr.; and Franklin Advisers, Inc. (all
located at One Franklin Parkway, San Mateo, CA 94403) are deemed to be the
beneficial owners of an aggregate 3,571,480 Common Shares as a result of
shares owned by one or more open or closed-end investment companies or other
managed accounts which are advised by direct and indirect investment
advisory subsidiaries of Franklin Resources, Inc. Includes 2,796,450 Common
Shares that would result upon the conversion of 1,500,000 Series C
Cumulative Convertible Preferred Shares.
(3) Based on information contained in a Schedule 13G filed with the SEC on
February 14, 2005. According to such Schedule 13G, (i) Barclays Global
Investors, NA (45 Fremont Street, San Francisco, CA 94105), (ii) Barclays
Global Fund Advisors (45 Fremont Street, San Francisco, CA 94105), (iii)
Barclays Global Investors, Ltd (Murray House, 1 Royal Mint Court, London,
EC3N 4HH), (iv) Barclays Global Investors Japan Trust and Banking Company
Limited (Ebisu Prime Square Tower 8th Floor, 1-1-39 Hiroo Shibuya-Ku, Tokyo
150-0012 Japan), (v) Barclays Life Assurance Company Limited (Unicorn House
5th Floor, 252 Romford Road, Forest Gate, London 37 9JB England), (vi)
Barclays Bank Plc (54 Lombard Street, London, England EC3P 3AH), (vii)
Barclays Capital Securities Limited (5 The North Colonmade, Canary Wharf,
London, England E14 4BB), (viii) Barclays Capital Inc. (200 Park Avenue, New
York, New York 10166), (ix) Barclays Private Bank & Trust (Isle of Man)
Limited (4th Floor, Queen Victoria House, Isle of Man, IM99 IDF), (x)
Barclays Private Bank and Trust (Jersey) Limited (39/41 Broad Street, St.
Helier, Jersey, Channel Islands JE4 8PU); (xi) Barclays Bank Trust Company
Limited (54 Lombard Street, London, England EC3P 3AH); (xii) Barclays Bank
(Suisse) SA (10 rue d'Italie, CH-1204 Geneva, Switzerland); (xiii) Barclays
Private Bank Limited (59/60 Grosvenor Street, London, WIX 9DA England);
(xiv) Bronco (Barclays Cayman) Limited (Walker House Mary Street PO Box 908
GT, George Town, Grand Cayman (Cayman Islands) are deemed to be the
beneficial owners of an aggregate of 2,663,392 Common Shares as a result of
their holding Common Shares in trust accounts for the economic benefit of
the beneficiaries of those accounts.
3
The following table indicates, as of March 31, 2005, (a) the number of
Common Shares beneficially owned by each trustee and each named executive
officer named in the Summary Compensation Table under "COMPENSATION OF EXECUTIVE
OFFICERS" below, and by all trustees and named executive officers as a group,
and (b) the percentage such shares represent of the total outstanding Common
Shares. All shares were owned directly on such date with sole voting and
investment power unless otherwise indicated.
BENEFICIAL OWNERSHIP OF
NAME OF BENEFICIAL OWNER SHARES(1) PERCENTAGE OF CLASS
------------------------ ----------------------- -------------------
E. Robert Roskind........................................ 2,170,233(2) 4.29%
Richard J. Rouse......................................... 482,284(3) *
T. Wilson Eglin.......................................... 408,011(4) *
Patrick Carroll.......................................... 248,962 *
William N. Cinnamond..................................... 38,607(5) *
Geoffrey Dohrmann........................................ 20,566 *
Carl D. Glickman......................................... 169,454(6) *
James Grosfeld........................................... 4,097 *
Kevin W. Lynch........................................... 7,268 *
Stanley R. Perla......................................... 6,557 *
Seth M. Zachary.......................................... 46,619 *
All trustees and named executive officers as a group (11 3,602,658 7.12%
persons)...............................................
---------------
* Represents beneficial ownership of less than 1.00%
(1) For purposes of this table, a person is deemed to have "beneficial
ownership" of any shares as of a given date which such person has the right
to acquire within 60 days after such date. For purposes of computing the
percentage of outstanding shares held by each beneficial owner named above
on a given date, any security which such person or persons has the right to
acquire within 60 days after such date is deemed to be outstanding, but is
not deemed to be outstanding for the purpose of computing the percentage
ownership of any other beneficial owner.
(2) Includes (i) 1,435,539 limited partnership units held by Mr. Roskind and
entities controlled by Mr. Roskind in Lepercq Corporate Income Fund L.P. and
Lepercq Corporate Income Fund II L.P. each of which is a subsidiary of the
Company, which are currently exchangeable, on a one-for-one basis, for
Common Shares, (ii) 167,840 Common Shares held in trust in which Mr. Roskind
is beneficiary, (iii) 53,547 Common Shares owned of record by Mr. Roskind's
wife, which Mr. Roskind disclaims beneficial ownership of, and (iv) 127,692
Common Shares held by entities controlled by Mr. Roskind.
(3) Includes (i) 86,494 limited partnership units held by Mr. Rouse in Lepercq
Corporate Income Fund L.P. and Lepercq Corporate Income Fund II L.P., which
are currently exchangeable, on a one-for-one basis, for Common Shares, and
(ii) 123,223 Common Shares held in trust in which Mr. Rouse is beneficiary.
(4) Includes 128,987 Common Shares held in trust in which Mr. Eglin is
beneficiary.
(5) Includes 100 Common Shares owned of record by Mr. Cinnamond's wife.
(6) Includes options to purchase 20,000 Common Shares at exercise prices ranging
from $11.81 -- $15.50 per share.
4
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's trustees and executive officers to file initial reports of
ownership and reports of changes in ownership of Common Shares and other equity
securities with the Securities and Exchange Commission and the New York Stock
Exchange. Trustees and executive officers are required to furnish the Company
with copies of all Section 16(a) forms they file. Based on a review of the
copies of such reports furnished to the Company and written representations from
the Company's trustees and executive officers, the Company believes that during
2004 fiscal year the Company's trustees and executive officers complied with all
Section 16(a) filing requirements applicable to them, except that Mr. Roskind
and Mr. Rouse, who were both inadvertently late in reporting the acquisition of
derivative securities, due to an administrative error. Upon discovery, these
transactions were promptly reported.
5
PROPOSAL NO. 1
ELECTION OF TRUSTEES
BOARD OF TRUSTEES
The Board of Trustees of the Company currently consists of nine trustees
and the entire Board is nominated to be elected at the Annual Meeting with
respect to which this Proxy Statement is being distributed. Election of trustees
requires the affirmative vote of a plurality of the votes cast by the
Shareholders of the outstanding Common Shares. The nine nominees for trustee are
E. Robert Roskind, Richard J. Rouse, T. Wilson Eglin, Geoffrey Dohrmann, Carl D.
Glickman, James Grosfeld, Kevin W. Lynch, Stanley R. Perla and Seth M. Zachary.
All of the nominees are presently serving as trustees of the Company. Each
nominee has consented to being named in the Proxy Statement and to serve if
elected. If elected, each nominee is expected to serve until the Company's 2006
Annual Meeting of Shareholders and until his successor is elected. Background
information relating to the nominees for election appears below.
THE ENCLOSED PROXY, IF PROPERLY COMPLETED, SIGNED, DATED AND RETURNED, AND
UNLESS AUTHORITY TO VOTE IS WITHHELD OR A CONTRARY VOTE IS INDICATED, WILL BE
VOTED FOR THE ELECTION OF THESE NINE NOMINEES. In the event any such nominee
becomes unavailable for election, votes will be cast, pursuant to authority
granted by the enclosed Proxy, for such substitute nominee as may be designated
by the Board of Trustees. All trustees serve for a term of one year and until
their respective successors are elected.
The following information relates to the nominees for election as trustees
of the Company:
NAME BUSINESS EXPERIENCE
---- ------------------------------------------------------------
E. ROBERT ROSKIND.................... Mr. Roskind has served as the Chairman of the Board of
Age 60 Trustees since October 1993 and was Co-Chief Executive
Officer of the Company from October 1993 to January 2003.
Mr. Roskind founded The LCP Group, L.P. ("LCP"), a real
estate advisory firm, in 1973 and has been its Chairman
since 1976. LCP has been the general partner of various
limited partnerships with which the Company has had prior
dealings. Mr. Roskind received his B.S. in 1966 from the
University of Pennsylvania and is a 1969 Harlan Fiske Stone
Graduate of the Columbia Law School. Mr. Roskind is on the
Board of Directors of Clarion CMBS Value Fund, Inc.
RICHARD J. ROUSE..................... Mr. Rouse has served as the Chief Investment Officer of the
Age 59 Company since January 2003, as Vice Chairman of the Board of
Trustees since April 1996 and as a trustee of the Company
since October 1993. Mr. Rouse served as President of the
Company from October 1993 to April 1996, and as Co-Chief
Executive Officer from October 1993 to January 2003. Mr.
Rouse graduated from Michigan State University in 1968 and
received his M.B.A. in 1970 from the Wharton School of
Finance and Commerce of the University of Pennsylvania.
T. WILSON EGLIN...................... Mr. Eglin has served as Chief Executive Officer of the
Age 40 Company since January 2003, Chief Operating Officer of the
Company since October 1993 and as a trustee since May 1994.
Mr. Eglin served as Executive Vice President from October
1993 to April 1996, and since April 1996 has served as the
President. Mr. Eglin received his B.A. from Connecticut
College in 1986.
6
NAME BUSINESS EXPERIENCE
---- ------------------------------------------------------------
GEOFFREY DOHRMANN.................... Mr. Dohrmann has served as a trustee since August 2000. Mr.
Age 54 Dohrmann co-founded Institutional Real Estate, Inc., a real
estate-oriented publishing and consulting company in 1987
and is currently its Chairman and Chief Executive Officer.
Mr. Dohrmann also belongs to the advisory boards for the
National Real Estate Index, The Journal of Real Estate
Portfolio Management and Center for Real Estate Enterprise
Management. Mr. Dohrmann is also a fellow of the Homer Hoyt
Institute and holds the Counselors of Real Estate (CRE)
designation.
CARL D. GLICKMAN..................... Mr. Glickman has served as a trustee since May 1994. Mr.
Age 78 Glickman has been President of The Glickman Organization, a
real estate development and management firm, since 1953. Mr.
Glickman is on the Board of Directors of Bear Stearns
Companies, Inc.
JAMES GROSFELD....................... Mr. Grosfeld has served as a trustee since November 2003. He
Age 67 also serves as a Director of Copart, Inc., Ramco-Gershenson
Properties Trust and BlackRock, Inc. He has served on the
Advisory Board of the Federal National Mortgage Association
and as Director of Interstate Bakeries Corporation and
Addington Resources. He was Chairman and Chief Executive
Officer of Pulte Home Corporation from 1974 to 1990. He
received his B.A. from Amherst College in 1959 and L.L.B.
from Columbia Law School in 1962.
KEVIN W. LYNCH....................... Mr. Lynch has served as a trustee from May 2003 to the
Age 52 present and from May 1996 to May 2000. Mr. Lynch co-founded
and has been a Principal of The Townsend Group since 1983.
The Townsend Group is a real estate consulting firm to
institutional investors in the United States. Mr. Lynch is a
frequent industry speaker and member of the Pension Real
Estate Association and the National Council of Real Estate
Investment Fiduciaries. He currently sits on the Real Estate
Advisory Board for New York University and is a Director for
First Industrial Realty Trust.
STANLEY R. PERLA..................... Mr. Perla has served as a trustee since April 2003. Mr.
Age 61 Perla, a licensed Certified Public Accountant, was a partner
for Ernst & Young LLP, a public accounting firm from
September 1978 to June 2003. He served as Ernst & Young's
National Director of Real Estate Accounting as well as Ernst
& Young's National Accounting and Auditing Committee. He is
an active member of the National Association of Real Estate
Investment Trusts and the National Association of Real
Estate Companies. Mr. Perla is also a director of American
Mortgage Acceptance Company and Vice President - Director of
Internal Audit for Vornado Realty Trust.
SETH M. ZACHARY...................... Mr. Zachary has served as a trustee since November 1993.
Age 52 Since 1987, Mr. Zachary has been a partner, and is currently
the Chairman, of the law firm Paul, Hastings, Janofsky &
Walker LLP, outside counsel to the Company.
7
MANAGEMENT
BOARD OF TRUSTEES AND COMMITTEES OF THE BOARD OF TRUSTEES
The Board of Trustees of the Company held fifteen meetings during the
fiscal year ended December 31, 2004. Each incumbent trustee attended at least
75% of the aggregate of the total number of meetings of the Board of Trustees
and all committees on which he served, with the exception of Mr. Grosfeld. The
Board of Trustees is comprised of nine trustees, a majority of whom are
"independent" as defined by the applicable listing standards of the New York
Stock Exchange. The Board of Trustees has four standing committees: the Audit
Committee, the Compensation Committee, the Nominating and Corporate Governance
Committee and the Executive Committee.
Audit Committee. The principal functions of the Audit Committee include
engaging the independent public accounting firm, reviewing with the independent
public accounting firm plans and results of the audit engagement, approving
professional services provided by the independent public accounting firm,
reviewing the independence of the independent public accountants, considering
the range of the audit, and reviewing the adequacy of the Company's internal
accounting controls. As of December 31, 2004, the Audit Committee was comprised
of Messrs. Perla (Chairman), Dohrmann and Lynch, all of whom were determined by
the Board of Trustees to be "independent" as that term is used in Item
7(d)(3)(iv) of Schedule 14A under the Securities Exchange Act of 1934, as
amended, and the applicable listing standards of the New York Stock Exchange.
Mr. Perla is an "Audit Committee Financial Expert," as determined by the Board
of Trustees in accordance with Item 401(h) of Regulation S-K. The Audit
Committee operates under a written charter adopted by the Board of Trustees, a
copy of which is available on the Company's Internet address located at
http://www.lxp.com, under "Investor Relations/Corporate Governance." Such
document is not deemed incorporated by reference into this Proxy Statement.
During the fiscal year ended December 31, 2004, the Audit Committee met twelve
times, including quarterly telephonic meetings with management and our
independent registered public accounting firm, to discuss matters concerning,
among other matters, financial accounting matters, the audit of the Company's
consolidated financial statements for the year ended December 31, 2004, and the
adequacy of the Company's internal controls over financial reporting.
Compensation Committee. The principal functions of the Compensation
Committee are to determine the compensation for the Company's executive officers
and to administer and review the Company's incentive compensation plans. The
Compensation Committee operates under a written charter adopted by the Board of
Trustees, a copy of which is available on the Company's Internet address located
at http://www.lxp.com, under "Investor Relations/Corporate Governance." Such
document is not deemed incorporated by reference into this Proxy Statement. As
of December 31, 2004, the Compensation Committee was comprised of Messrs. Lynch
(Chairman), Grosfeld and Perla, all of whom are "independent" as defined by the
applicable listing standards of the New York Stock Exchange. During the fiscal
year ended December 31, 2004, the Compensation Committee met four times.
Executive Committee. The principal function of the Executive Committee is
to exercise the authority of the Board of Trustees regarding routine matters
performed in the ordinary course of business. As of December 31, 2004, the
Executive Committee was comprised of Messrs Glickman (Chairman), Eglin and
Roskind. During the fiscal year ended December 31, 2004, the Executive Committee
met two times.
Nominating and Corporate Governance Committee. The principal function of
the Nominating and Corporate Governance Committee is to identify individuals
qualified to become trustees and/or executive officers, monitor corporate
governance guidelines, lead the annual review of the Board of Trustees and make
recommendations for service on all other committees. The Nominating and
Corporate Governance Committee operates under a written charter adopted by the
Board of Trustees, a copy of which is available on the Company's Internet
address located at http://www.lxp.com, under "Investor Relations/Corporate
Governance." Such document is not deemed incorporated by reference into this
Proxy Statement. As of December 31, 2004, the Nominating and Corporate
Governance Committee was comprised of Messrs. Dohrmann (Chairman), Grosfeld and
Glickman, each of whom are "independent" as defined by the applicable listing
standards of the New York Stock Exchange. The Nominating and Corporate
Governance Committee did not
8
meet during 2004. The Nominating and Corporate Governance Committee does not
currently intend to consider trustee nominations by Shareholders.
The Board of Trustees and the Nominating and Corporate Governance Committee
believes that such Committee is qualified and in the best position to identify,
review, evaluate and select qualified Board of Trustees candidates based on the
criteria described in the next paragraph.
In recommending candidates for the Board of Trustees, the Nominating and
Corporate Governance Committee's assessment includes consideration of issues of
judgment, diversity, age, expertise and experience. The Nominating and Corporate
Governance Committee also considers other relevant factors as it deems
appropriate, including the current composition of the Board of Trustees, the
balance of management and independent trustees, and the evaluations of other
prospective candidates. After completing this evaluation and review, the
Nominating and Corporate Governance Committee makes a recommendation to the full
Board of Trustees as to the persons who should be nominated by the Board of
Trustees, and the Board of Trustees determines the nominees after considering
the recommendation and report of the Nominating and Corporate Governance
Committee.
The Company expects all trustees to attend each Annual Meeting of
Shareholders, but from time to time other commitments prevent all trustees from
attending each meeting. All trustees that were trustees at such time attended
the most recent annual general meeting of shareholders, which was held on May
26, 2004.
SHAREHOLDER COMMUNICATIONS
Shareholders wishing to communicate with the Board of Trustees should
address their inquiries to the Company's General Counsel by mail sent to the
Company's principal executive office located at One Penn Plaza, Suite 4015, New
York, New York, 10119-4015. The mailing envelope should contain a clear
notification indicating that the enclosed letter is a "Shareholder-Board
Communication" or "Shareholder-Trustee Communication." All such letters should
clearly state whether the intended recipients are all members of the Board of
Trustees or certain specified individual trustees. All communications will be
reviewed by the Company's Chief Executive Officer who will determine whether the
communication will be relayed to the Board of Trustees, to certain committees of
the Board of Trustees or to individual members of the Board of Trustees. Except
for resumes, sales and marketing communications, or notices regarding seminars
or conferences, summaries of all shareholder communications will be provided to
the Board of Trustees.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Each of the Company's trustees and executive officers has entered into an
indemnification agreement with the Company. Pursuant to these agreements, the
Company agrees to indemnify each trustee and executive officer who is a party to
such an agreement against any and all judgments, penalties, fines, settlements
and reasonable expenses (including attorneys' fees) actually incurred by the
trustee or executive officer of the Company or in a similar capacity for any
other entity at the Company's request. These agreements include certain
limitations on the Company's obligations in certain circumstances, particularly
in situations in which such indemnification is prohibited or limited by
applicable law.
As of December 31, 2003, the Company was obligated for approximately
$808,000 resulting from the acquisition of certain properties in 1996. Of the
approximately $808,000, Mr. Roskind, our Chairman, and Mr. Rouse, our Vice
Chairman, were owed approximately $414,000. During 2004, this obligation was
satisfied as part of the acquisition by the Company of 100% of the partnership
interests it did not already own of a partnership that owned a single tenant net
leased property. The acquisition was effected through the issuance of 97,828
interests in one of the Company's operating partnerships ("OP Units"), of which
Messrs. Roskind and Rouse received an aggregate 27,212 OP Units.
All related transactions were approved by the independent members of the
Board of Trustees or the Audit Committee.
9
CERTAIN BUSINESS RELATIONSHIPS
Seth M. Zachary, who is presently serving as a member of the Board of
Trustees and is a nominee to serve as a trustee until the 2006 Annual Meeting of
Shareholders, is a partner of Paul, Hastings, Janofsky & Walker LLP, which is
the outside counsel to the Company. The Company, including all non-consolidated
joint ventures, paid Paul, Hastings, Janofsky & Walker LLP approximately
$1,735,000 for services during 2004. The Company intends to continue to retain
the services of Paul, Hastings, Janofsky & Walker LLP for general, real estate,
corporate and other matters.
10
COMPENSATION OF EXECUTIVE OFFICERS
Summary of Cash and Certain Other Compensation. The following table sets
forth the summary compensation to the Chairman of the Board of Trustees and the
four other most highly paid executive officers of the Company for the calendar
years 2004, 2003 and 2002.
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
-----------------------------------
PAYOUTS
AWARDS ---------
ANNUAL OTHER ----------------------- LONG TERM
COMPENSATION ANNUAL RESTRICTED SECURITIES INCENTIVE ALL OTHER
FISCAL ------------------- COMPEN- SHARE UNDERLYING PLAN COMPEN-
NAME AND YEAR BONUS SATION AWARDS OPTIONS PAYOUTS SATION
PRINCIPAL POSITION ENDED SALARY($) ($)(1) ($) ($)(2) (#)(3) ($) ($)(4)
------------------ -------- --------- ------- ------- ---------- ---------- --------- ---------
E. Robert Roskind(5)......... 12/31/04 380,000 27,083 -- 1,095,126 -- -- 2,772
Chairman of the Board of 12/31/03 350,000 23,583 -- 752,865 -- -- 2,772
Trustees 12/31/02 320,000 23,333 -- 174,174 50,000 -- 640
Richard J. Rouse(5).......... 12/31/04 370,000 150,491 -- 754,883 -- -- 3,387
Vice Chairman and 12/31/03 300,000 231,250 -- 1,459,048 -- -- 3,412
Chief Investment Officer 12/31/02 270,000 21,250 -- 138,229 50,000 -- 640
T. Wilson Eglin(5)........... 12/31/04 380,000 154,254 -- 822,440 -- -- 1,974
Chief Executive Officer, 12/31/03 310,000 238,658 -- 1,466,346 -- -- 1,974
President and Chief 12/31/02 275,000 21,458 -- 141,004 50,000 -- 640
Operating Officer
Patrick Carroll(6)........... 12/31/04 275,000 114,740 -- 659,345 -- -- 1,372
Chief Financial Officer, 12/31/03 250,000 194,208 -- 925,030 -- -- 1,512
Treasurer and Executive 12/31/02 220,000 19,167 -- 113,352 50,000 -- 640
Vice President
William N. Cinnamond(7)...... 12/31/04 240,000 11,250 -- 90,996 -- -- 487,460(8)
Senior Vice President 12/31/03 240,000 110,000 -- 413,829 -- -- 660
12/31/02 220,000 19,167 -- 85,002 50,000 -- 640
---------------
(1) Bonus amounts include amounts contributed at the election of the Company
pursuant to the Company's plan established under Section 401(k) of the
Internal Revenue Code of 1986, as amended, and year-end awards at the
discretion of the Compensation Committee of the Board of Trustees.
(2) Restricted share awards of Common Shares generally vest ratably over 5
years; however, certain shares vest after 5 years while others only vest if
certain performance criteria are met. Restricted share awards are valued at
the fair market value of the Common Shares on the date of grant.
(3) Options to acquire Common Shares at exercise prices equal to the fair market
value of the Common Shares on the grant dates.
(4) Amount represents the dollar value of life insurance premiums paid by the
Company during the applicable fiscal year with respect to the life of the
named executive officer.
(5) Messrs. Roskind and Rouse served as Co-Chief Executive Officers of the
Company until January 2003. Mr. Eglin was elected Chief Executive Officer of
the Company effective January 2003.
(6) Mr. Carroll was elected Executive Vice President in January 2003.
(7) Mr. Cinnamond was elected Senior Vice President of the Company in September
2001. In August 2004, Mr. Cinnamond resigned effective January 2005.
(8) In February 2005, the Company provided Mr. Cinnamond with a severance
payment of $486,800, which was accrued in 2004.
Share Options. No Common Share options were granted during the fiscal year
ended December 31, 2004 to any of the executive officers named in the Summary
Compensation Table. Since inception, the Company has not granted any share
appreciation or dividend equivalent rights.
11
Option Exercises/Value of Unexercised Options. The following table sets
forth certain information concerning the exercise of share options during the
fiscal year ended December 31, 2004 by the executive officers named in the
Summary Compensation Table, and the year-end value of unexercised options held
by such persons.
SHARE OPTION EXERCISES IN FISCAL YEAR 2004
AND FISCAL YEAR-END OPTION VALUES
VALUE OF UNEXERCISED
SHARES NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED OPTIONS AT FISCAL YEAR-END AT FISCAL YEAR-END
ON VALUE --------------------------- ---------------------------
EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
NAME (#) ($) (#) (#) ($) ($)
---- -------- -------- ----------- ------------- ----------- -------------
E. Robert Roskind.......... 30,000 236,731 -- 12,500 -- 88,500
Richard J. Rouse........... 37,500 307,438 -- 12,500 -- 88,500
T. Wilson Eglin............ 37,500 285,314 -- 12,500 -- 88,500
Patrick Carroll............ 92,078 687,521 2,675 12,500 18,939 88,500
William N. Cinnamond....... 66,232 391,020 -- 12,500 -- 88,500
COMPENSATION OF TRUSTEES
Each non-employee trustee receives an annual fee of $25,000 for service as
a trustee. Such trustees currently also receive $1,000 for each meeting of the
Board of Trustees or any committee thereof attended by the trustee and
reimbursement for expenses incurred in attending such meetings, and $500 for
telephonic meetings of the Board of Trustees. In addition, the chairpersons of
the Audit Committee and Compensation Committee and the Lead Trustee received an
additional $7,500 per annum in 2004, which has been increased to $10,000 for
2005. The chairperson of the Nominating and Corporate Governance Committee will
also receive an additional $10,000 in 2005. Pursuant to the 1994 Outside
Director Stock Plan, as amended, each non-employee trustee was required to
receive not less than 50% of such trustee's fees in Common Shares based on a per
share value equal to 95% of the trading value of Common Share as of the date of
payment. During 2004, all trustees elected to receive 100% of their trustee fees
in Common Shares. Effective January 1, 2003, all non-employee trustees received
annually, in addition to the fees described above, 2,000 Common Shares, which
was increased to 2,500 Common Shares for 2005.
EMPLOYMENT AGREEMENTS
The Company has entered into an employment agreement with each of Messrs.
Roskind, Rouse, Eglin and Carroll, as well as Mr. John B. Vander Zwaag,
Executive Vice President, and Mr. Paul R. Wood, Vice President, Chief Accounting
Officer and Secretary. Each such agreement sets forth the terms of the named
officer's employment by the Company including compensation and benefits. In
addition, pursuant to each agreement, upon the occurrence of a "change in
control" of the Company (including a change in ownership of more than fifty
percent of the total combined voting power of the Company's outstanding
securities, the sale of all or substantially all of the Company's assets,
dissolution of the Company, the acquisition, except from the Company, of 20% or
more of the Common Shares or voting shares of the Company or a change in the
majority of the Board of Trustees), the named officers would be entitled to
severance benefits equal to: (a) three times (for Messrs. Roskind, Rouse, Eglin,
Carroll and Vander Zwaag), and one time (for Mr. Wood) the officers' current
annual base salary and recent annual bonus, as defined.
In addition, the Company will, at its expense, provide continued health
care coverage under the Company's medical and dental plans to the officers
referenced above and eligible dependents for three years for Messrs. Roskind,
Rouse, Eglin, Carroll and Vander Zwaag, and one year for Mr. Wood.
12
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF TRUSTEES
The Audit Committee of the Board is responsible for providing independent,
objective oversight of the Company's accounting functions and internal controls.
The Audit Committee is composed of three trustees each of whom is independent as
independence is defined in the New York Stock Exchange's listing rules. The
Audit Committee operates under a written charter approved by the Board of
Trustees, a copy of which is available on the Company's Internet address located
at http://www.lxp.com, under "Company Profile/Corporate Governance". Such
document is not deemed incorporated by reference into this Proxy Statement. As
of December 31, 2004, the Audit Committee was comprised of Messrs. Perla
(Chairman), Dohrmann and Lynch.
Management is responsible for the Company's internal controls and financial
reporting process. The independent registered public accounting firm is
responsible for performing an independent audit of the Company's consolidated
financial statements in accordance with auditing standards generally accepted in
the United States of America, attesting to management's assessment of, and the
effectiveness of, the Company's internal control over financial reporting in
accordance with the auditing standards of the Public Company Accounting
Oversight Board (United States), and issuing a report thereon. The Audit
Committee's responsibility is to monitor and oversee these processes. The Audit
Committee charter is designed to assist the Audit Committee in complying with
applicable provisions of the Securities Exchange Act of 1934, as amended, and
the New York Stock Exchange's listing rules, all of which relate to corporate
governance and many of which directly or indirectly affect the duties, powers
and responsibilities of the Audit Committee. Among these duties, powers and
responsibilities of the Audit Committee as provided in the Audit Committee
charter, the Audit Committee:
- has sole power an authority concerning the engagement and fees of
independent registered public accounting firms,
- reviews with the independent registered public accounting firm the scope
of the annual audit and the audit procedures to be utilized,
- pre-approves audit and permitted non-audit services provided by the
independent registered public accounting firm,
- reviews the independence of the independent registered public accounting
firm,
- reviews the adequacy of the Company's internal accounting controls, and
- reviews accounting, auditing and financial reporting matters with the
Company's independent registered public accounting firm and management.
In connection with these responsibilities, the Audit Committee met with
management and the independent registered public accounting firm to review and
discuss the December 31, 2004 audited consolidated financial statements. The
Audit Committee has discussed with the independent registered public accounting
firm the matters required to be discussed by Statement of Auditing Standards No.
61. The Audit Committee also received written disclosures and the letter from
the independent registered public accounting firm required by Independence
Standards Board Standard No. 1 (Independence Discussions with Audit Committees),
and the Audit Committee discussed with the independent registered public
accounting firm that firm's independence.
Consistent with Securities and Exchange Commission policies regarding
auditor independence, the Audit Committee has responsibility for appointing,
setting compensation and overseeing the work of the independent registered
public accounting firm. In recognition of this responsibility, the Audit
Committee has established a policy to pre-approve all audit and permissible
non-audit services provided by the independent registered public accounting
firm.
During the year, circumstances may arise when it may become necessary to
engage the independent registered public accounting firm for additional services
not contemplated in the original pre-approval. In
13
those instances, the Audit Committee requires specific pre-approval before
engaging the independent registered public accounting firm.
Pursuant to our Audit Committee charter, the Audit Committee may delegate
pre-approval authority to one or more of its members, who shall promptly advise
the remaining members of the Audit Committee of such approval at the next
regularly scheduled meeting.
Based upon the Audit Committee's discussions with management and the
independent registered public accounting firm referred to above, and the Audit
Committee's review of the representations of management, the Audit Committee
recommended that the Board of Trustees include the December 31, 2004 audited
consolidated financial statements in the Company's Annual Report on Form 10-K
for the year ended December 31, 2004, to be filed with the Securities and
Exchange Commission.
Audit Committee of the Board of
Trustees
Stanley R. Perla, Chairman
Geoffrey Dohrmann
Kevin W. Lynch
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As of December 31, 2004, the Compensation Committee consisted of Messrs.
Lynch (Chairman), Grosfeld and Perla. None of Messrs. Lynch, Grosfeld or Perla
are or have been executive officers of the Company.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF TRUSTEES
For the fiscal year ended December 31, 2004, all matters concerning
executive compensation for the Chief Executive Officer and other executive
officers were considered and acted upon by the Compensation Committee of the
Board of Trustees.
Compensation Philosophy. The Company's compensation program for executive
officers is based upon a desire to achieve both its short-term and long-term
business goals and strategies with a view to enhancing shareholder value. To
achieve its goals, the Company recognizes that it must adopt a compensation
program which will attract, retain and motivate qualified and experienced
executive officers, and that its compensation program should align the financial
interests of its executive officers with those of its Shareholders.
Compensation of Executive Officers (other than the Chief Executive
Officer). In approving the annual salary for the executive officers of the
Company (other than the Chief Executive Officer) for 2004, the Compensation
Committee considered several factors, including the scope of the individual's
responsibilities, competitive payment practices, the historical financial
results of the Company and the anticipated financial performance of the Company.
The compensation determination for each individual was largely subjective and no
specific weight was given to any particular factor. In addition to their base
salaries, these executive officers of the Company receive discretionary bonuses
tied to the overall performance of the Company and their individual
performances. In this regard, the Compensation Committee established specific
performance goals for the payment of discretionary bonuses which are based on
the per share growth in cash available for distributions and total annual
Shareholder return, and also considered the results of a compensation study
prepared for the Company by an independent outside compensation consulting firm
(as described further below).
Compensation of Chief Executive Officer. As with the other executive
officers, the Compensation Committee determined the annual salary for the Chief
Executive Officer based upon a number of factors and criteria, including the
historical financial results of the Company, the anticipated financial
performance of the Company and the requirements of such Chief Executive Officer.
The compensation determination for the Chief Executive Officer was largely
subjective, and no specific weight was given to any particular factor. The Chief
Executive Officer of the Company is also eligible to receive discretionary
bonuses tied to the overall
14
performance of the Company and his individual performance. The Compensation
Committee has established specific performance goals for the payment of
discretionary bonuses which are the same as for the other executive officers of
the Company, and also considered the results of a compensation study prepared
for the Company by an independent outside compensation consulting firm (as
described further below).
1998 Share Option Plan and 2002 Equity-Based Award Plan. The Company had
traditionally provided its executive officers with the opportunity to acquire
significant equity stakes in its growth and prosperity through the grant of
Common Share options. Based in part on the results of a compensation study
prepared for the Company by an independent outside compensation consulting firm,
the Compensation Committee determined that it is in the Company's best interest
to cease granting options to its executive officers under its existing plans
(the 1998 Share Option Plan and the 2002 Equity-Based Award Plan) effective
January 1, 2003. However, other forms of compensation, including Common Share
awards which are subject to a vesting schedule, may be and have been granted to
the Company's executive officers under the 2002 Equity-Based Award Plan and the
1998 Share Option Plan.
Compensation Study. In 2004, the Compensation Committee retained the
services of an independent outside compensation consulting firm to review the
Company's existing executive compensation program and to develop recommendations
for bonuses in respect of 2004 and salary and long-term incentive programs for
2005.
Compensation Committee of the Board of
Trustees
Kevin W. Lynch, Chairman
James Grosfeld
Stanley R. Perla
15
PROPOSAL NO. 2
ARTICLES OF AMENDMENT TO LEXINGTON'S DECLARATION OF TRUST
The Board of Trustees of the Company unanimously recommends that the
Shareholders approve the proposal to amend the Company's Declaration of Trust to
increase the number of authorized Common Shares and excess shares which the
Company has authority to issue from 80,000,000 Common Shares and 40,000,000
excess shares to 160,000,000 Common Shares and 170,000,000 excess shares. For a
complete description of the proposed amendment, you are encouraged to read the
complete text of the Articles of Amendment, a copy of which is attached as Annex
A to this Proxy Statement.
As of April 11, 2005, which was the latest practicable date prior to the
printing of this Proxy Statement, the Company had approximately 10.16 million
Common Shares authorized and unissued, taking into account the number of shares
that (i) were issued and outstanding as of that date, (ii) are issuable by the
Company upon the exercise of outstanding Common Share options or upon conversion
of outstanding securities convertible into Common Shares, including the
Company's Series C Cumulative Convertible Preferred Shares and units of limited
partnership of the Company's operating partnership subsidiaries, (iii) are
issuable by the Company upon the conversions by the Company's applicable joint
venture partner of interests in Lexington Acquiport Company, LLC, or LAC, one of
the Company's joint ventures, and (iv) have been repurchased by the Company. In
addition to LAC, the Company has three other joint ventures where each joint
venture partner has the right to convert its interest in the applicable joint
venture into Common Shares of the Company.
The Board of Trustees believes that it is important to have a sufficient
number of authorized but unissued shares available to provide for future raises
of capital, for use in connection with acquisitions and for other general
business purposes. Raising the number of authorized shares will provide the
Company with the flexibility to provide for such circumstances.
The Board of Trustees also recommends a corresponding increase in the
number of excess shares in order to ensure compliance with the ownership limits
in the Company's Declaration of Trust necessary to maintain its status as a real
estate investment trust. In the event that any shareholder acquires common or
preferred shares in excess of the ownership limit, the proposed increase would
ensure that the Company could issue a sufficient number of excess shares
necessary to comply with these restrictions.
Further issuances of Common Shares could have a dilutive effect on
Shareholders' voting and economic interests in the Company. Furthermore,
issuance of newly authorized shares could be used by the Board of Trustees to
delay or hinder a hostile acquisition proposal.
The submission of this proposal is not part of any plan by the Company's
Board of Trustees or management to engage in any transaction which would require
the approval of this proposed increase.
APPROVAL OF THE ARTICLES OF AMENDMENT TO THE COMPANY'S DECLARATION OF TRUST
TO INCREASE THE NUMBER OF AUTHORIZED COMMON SHARES AND EXCESS SHARES REQUIRES
THE AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE SHARES ENTITLED TO VOTE
THEREON BY PERSON OR BY PROXY AT THE MEETING. AS A RESULT, ANY SHARES NOT
AFFIRMATIVELY VOTED (WHETHER BY ABSTENTION, BROKER NON-VOTE OR OTHERWISE) WILL
HAVE THE SAME EFFECT AS A VOTE AGAINST PROPOSAL NO. 2.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR PROPOSAL NO. 2.
16
PERFORMANCE GRAPH
The graph and table set forth below compare the cumulative total
Shareholder return on the Company's Common Shares for the period of December 31,
1999 through December 31, 2004 with the NAREIT Equity REIT Total Return Index,
(which includes all tax-qualified equity REITs listed on the New York Stock
Exchange, the American Stock Exchange and the NASDAQ National Market System),
the Russell 2000 Index and the S&P 500 Index for the same period. The graph and
table assume an investment of $100 in the Common Shares and in each index on
December 31, 1999 (and the reinvestment of all dividends).
THE PERIOD OF DECEMBER 31, 1999 THROUGH DECEMBER 31, 2004
[PERFORMANCE GRAPH]
--------------------------------------------------------------------------
Company/Index Name 12/31/99 12/31/00 12/31/01 12/31/02 12/31/03 12/31/04
--------------------------------------------------------------------------
Lexington Corporate
Properties Trust $100.00 $143.49 $206.36 $230.34 $315.47 $377.95
NAREIT Equity REIT
Total Return Index $100.00 $126.37 $143.97 $149.47 $204.98 $269.71
Russell 2000 Index $100.00 $ 95.80 $ 96.78 $ 75.90 $110.33 $129.09
S&P 500 Index $100.00 $ 89.86 $ 78.14 $ 59.88 $ 75.68 $ 82.49
OTHER MATTERS
The Board of Trustees is not aware of any business to come before the
Annual Meeting other than the election of trustees and the proposal to approve
and adopt the Articles of Amendment to the Company's Declaration of Trust to
increase the number of authorized common and excess shares. However, if any
other matters should properly come before the Annual Meeting, including matters
relating to the conduct of the Annual Meeting, it is intended that proxies in
the accompanying form will be voted in respect thereof in accordance with the
judgment of the person or persons voting the proxies.
17
APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Independent registered public accounting firm, KPMG LLP, was engaged to
perform the annual audit of the consolidated financial statements of the Company
for the calendar year ended December 31, 2004. There are no affiliations between
the Company and its partners, associates or employees, other than as pertaining
to its engagement as independent registered public accounting firm for the
Company. Representatives of KPMG LLP are expected to be present at the Annual
Meeting and will be given the opportunity to make a statement if they so desire
and to respond to appropriate questions.
The Audit Committee of the Board of Trustees will submit its recommendation
with respect to the engagement of independent registered public accounting firm
for the year ending December 31, 2005 at the meeting of the full Board of
Trustees, which is expected to take place during the Company's second fiscal
quarter. KPMG LLP has been the Company's independent registered public
accounting firm since 1993.
The following table presents fees for professional audit services rendered
by KPMG LLP for the audit of the Company's annual financial statements for each
of 2004 and 2003, and fees billed for other services rendered by KPMG LLP.
2004 2003
---------- --------
Audit fees.................................................. $ 909,444 $136,000
Audit-related fees.......................................... 215,069(1) 142,044(2)
---------- --------
Total audit and audit-related fees........................ $1,124,513 $278,044
Tax fees(3)................................................. $ 152,500 $ 87,000
All other fees.............................................. 12,629(4) $ 1,461(5)
---------- --------
Total fees................................................ $1,289,642 $366,505
========== ========
---------------
(1) 2004 audit-related fees include services rendered relating to the Company's
2004 Common Share and Preferred Share offerings and audits of joint
ventures.
(2) 2003 audit-related fees include services rendered relating to the Company's
2003 and 2002 Common Share and Preferred Share offerings.
(3) Tax fees consisted of fees for tax compliance services and tax preparation.
(4) Relates to (i) $1,629 for a licensing fee paid by the Company to KPMG for
accounting research software and (ii) $11,000 for tax.
(5) Relates to a licensing fee paid by the Company to KPMG for accounting
research software.
The Audit Committee has determined that the non-audit services provided by
the independent registered public accounting firm are compatible with
maintaining the accountants' independence.
The Audit Committee of the Board of Trustees must pre-approve the audit and
non-audit services performed by the Company's independent auditor, and has
adopted appropriate policies in this regard. With regard to fees, annually, the
independent auditor provides the Audit Committee with an engagement letter
outlining the scope of the audit services proposed to be performed during the
fiscal year. Upon the Audit Committee's acceptance of and agreement to the
engagement letter, the services within the scope of the proposed audit services
are deemed pre-approved pursuant to this policy. The Audit Committee must pre-
approve any change in the scope of the audit services to be performed by the
independent auditor and any change in fees relating to any such change. Specific
audit-related services and tax services are pre-approved by the Audit Committee,
subject to limitation on the dollar amount of such fees, which dollar amount is
established annually by the Audit Committee. Services not specifically
identified and described within the categories of audit services, audit-related
services and tax services must be expressly pre-approved by the Audit Committee
prior to the Company engaging any such services, regardless of the amount of the
fees involved. The Audit Committee may delegate pre-approval authority to one or
more of its members. The member or members to whom such authority is delegated
must report any pre-approval decision to the Audit
18
Committee at its next scheduled meeting. The Audit Committee does not delegate
to management its responsibilities to pre-approve services to be performed by
the Company's independent auditor.
MISCELLANEOUS
The cost of solicitation of proxies will be borne by the Company. The
Company has retained Mellon Investor Services, LLC, an outside proxy
solicitation firm, in connection with the Annual Meeting and will pay $9,500 for
its services. The Company will reimburse brokerage firms and other custodians,
nominees and fiduciaries for reasonable expenses incurred by them in sending
proxy material to the beneficial owners of Common Shares. In addition to
solicitations by mail, trustees, officers and regular employees of the Company
may solicit proxies personally or by telegraph, telephone facsimile, email or
other similar means without additional compensation.
SHAREHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials for
next year's Annual Meeting of Shareholders, any Shareholder proposal to take
action at such meeting must be received at the principal executive office of the
Company located at One Penn Plaza, Suite 4015, New York, New York 10119-4015, no
later than December 29, 2005. Any such proposals shall be subject to the
requirements of the proxy rules adopted by the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as amended.
19
ANNEX A
LEXINGTON CORPORATE PROPERTIES TRUST
ARTICLES OF AMENDMENT
OF THE
DECLARATION OF TRUST
May , 2005
Lexington Corporate Properties Trust, a Maryland statutory real estate
investment trust having its principal office in Baltimore City, Maryland (the
"Trust"), hereby certifies to the State of Maryland Department of Assessments
and Taxation that:
FIRST: The Trust desires to amend its Declaration of Trust as
currently in effect (the "Declaration of Trust").
SECOND: The Declaration of Trust is hereby amended by replacing
Article SIXTH (a) with the following:
"(a) The total number of shares of beneficial interest of all
classes which the Trust has authority to issue is 340,000,000 shares of
beneficial interest (par value $.0001 per share), of which 160,000,000
shares are classified as "Common Stock," 170,000,000 shares are
classified as "Excess Stock" and 10,000,000 shares are classified as
"Preferred Stock" (of which 3,160,000 shares are classified as "8.05%
Series B Cumulative Redeemable Preferred Stock" ("Series B Preferred")
and 3,100,000 shares are classified as "6.50% Series C Cumulative
Convertible Preferred Stock" ("Series C Preferred")). The Board of
Trustees may classify and reclassify any unissued shares of beneficial
interest by setting or changing, in any one or more respects, the
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications or terms or conditions of
redemption of such shares of beneficial interest."
THIRD: (a) As of immediately before the above amendment, the total
number of shares of beneficial interest of all classes which the Trust had
authority to issue were 130,000,000 shares (par value $.0001 per share), of
which 80,000,000 shares were classified as "Common Stock," 40,000,000
shares were classified as "Excess Stock" and 10,000,000 shares were
classified as "Preferred Stock" (of which 3,160,000 shares were classified
as Series B Preferred and 3,100,000 shares were classified as Series C
Preferred).
(b) As amended, the total number of shares of beneficial interest of
all classes which the Trust has authority to issue is 340,000,000 shares
(par value $.0001 per share), of which 160,000,000 shares are classified as
"Common Stock," 170,000,000 shares are classified as "Excess Stock" and
10,000,000 shares are classified as "Preferred Stock" (of which 3,160,000
shares are classified as Series B Preferred and 3,100,000 shares are
classified as Series C Preferred).
(c) The aggregate par value of all shares was $13,000 before the above
amendment and is $34,000 as amended.
(d) The shares of beneficial interest of the Trust are divided into
classes but the descriptions of each class of beneficial interest of the
Trust are not changed by the amendment.
FOURTH: The Board of Trustees, at a board meeting duly held on March
15, 2005, unanimously approved the above amendment, adopted a resolution
which sets forth the above amendment to the Declaration of Trust, and
declared that said amendment was advisable. Notice having been duly given
to the shareholders, the above amendment was approved by the holders of
record of a majority of all outstanding shares of beneficial interest of
the Trust entitled to vote on the above amendment at an annual meeting of
the shareholders of the Trust held on May , 2005.
A-1
IN WITNESS WHEREOF, Lexington Corporate Properties Trust has caused these
presents to be signed in its name and on its behalf by its President and
witnessed by its Secretary as of the date first above written.
WITNESS: LEXINGTON CORPORATE
PROPERTIES TRUST
--------------------------------------------- By:
PAUL R. WOOD ---------------------------------------------
Secretary T. WILSON EGLIN
President
THE UNDERSIGNED, T. Wilson Eglin, President of Lexington Corporate
Properties Trust, who executed on behalf of the Trust the foregoing Articles of
Amendment of which this certificate is made a part, hereby acknowledges in the
name and on behalf of said Trust the foregoing Articles of Amendment to be the
act of said Trust and hereby certifies that to the best of his knowledge,
information, and belief that matters and facts set forth therein with respect to
the authorization and approval thereof are true in all material respects under
the penalties of perjury.
--------------------------------------
T. WILSON EGLIN
President
A-2
THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS
INDICATED, WILL BE VOTED "FOR" THE PROPOSALS.
Please
Mark Here for
Address Change
or Comments [ ]
SEE REVERSE SIDE
ITEM 1. ELECTION OF TRUSTEES
Nominees: WITHHELD
FOR FOR ALL
01 E. Robert Roskind
02 Richard J. Rouse
03 T. Wilson Eglin [ ] [ ]
04 Geoffrey Dohrmann
05 Carl D. Glickman
06 James Grosfeld
07 Kevin W. Lynch
08 Stanley R. Perla
09 Seth M. Zachary
Withheld for the nominees you list below: (Write that nominee's name in the
space provided below.)
-------------------------------------------------------------------------
ITEM 2. TO APPROVE AN AMENDMENT TO THE COMPANY'S DECLARATION OF TRUST TO
INCREASE THE NUMBER OF AUTHORIZED COMMON SHARES AND EXCESS SHARES.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
ITEM 3. TO TRANSACT SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE 2005 ANNUAL MEETING.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
Choose MLINK(SM) for fast, easy and secure 24/7 online access to your future
proxy materials, investment plan statements, tax documents and more. Simply log
on to INVESTOR SERVICEDIRECT(R) at www.melloninvestor.com/isd where step-by step
instructions will prompt you through enrollment.
Signature: Signature: Date:
--------------------- --------------------- --------
NOTE: Please sign as name appears heron. Joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full title as such.
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FOLD AND DETACH HERE
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
INTERNET AND TELEPHONE VOTING IS AVAILABLE THROUGH 11:59 PM EASTERN TIME
THE DAY PRIOR TO ANNUAL MEETING DAY.
YOUR INTERNET OR TELEPHONE VOTE AUTHORIZES THE NAMED PROXIES TO VOTE YOUR
SHARES IN THE SAME MANNER AS IF YOU MARKED, SIGNED AND RETURNED YOUR PROXY CARD.
INTERNET TELEPHONE MAIL
HTTP://WWW.PROXYVOTING.COM/LXP 1-866-540-5760
Use the Internet to vote Use any touch-tone Mark, sign and date
your proxy. Have your OR telephone to vote OR your proxy card and
proxy card in hand when your proxy. Have return it in the
you access the web site. our proxy card in enclosed postage-paid
hand when you call. envelope.
IF YOU VOTE YOUR PROXY BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR PROXY CARD.
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF
LEXINGTON CORPORATE PROPERTIES TRUST
The undersigned hereby appoints Patrick Carroll and Paul R. Wood, and each of
them, with power to act without the other and with power of substitution, as
proxies and attorneys-in-fact and hereby authorizes them to represent and vote,
as provided on the other side, all the shares of Lexington Corporate Properties
Trust which the undersigned is entitled to vote, and, in their discretion, to
vote upon such other business as may properly come before the Annual Meeting of
Shareholders of the Trust to be held May 24, 2005 or at any adjournment or
postponement thereof, with all powers which the undersigned would possess if
present at the Meeting.
(Continued and to be marked, dated and signed, on the other side)
Address Change/Comments (Mark the corresponding box on the reverse side)
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YOU CAN NOW ACCESS YOUR LEXINGTON CORPORATE PROPERTIES TRUST ACCOUNT ONLINE.
Access your Lexington Corporate Properties Trust shareholder/stockholder account
online via Investor ServiceDirect(R) (ISD).
Mellon Investor Services LLC, Transfer Agent for Lexington Corporate Properties
Trust, now makes it easy and convenient to get current information on your
shareholder account.
o View account status o View payment history for dividends
o View certificate history o Make address changes
o View book-entry information o Obtain a duplicate 1099 tax form
o Establish/change your PIN
VISIT US ON THE WEB AT HTTP://WWW.MELLONINVESTOR.COM
CALL 1-877-978-7778 BETWEEN 9AM-7PM
MONDAY-FRIDAY EASTERN TIME