AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 14, 2004
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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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:
--------------------------------------------------------------------------------
(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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(3) Filing Party:
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(4) Date Filed:
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LEXINGTON CORPORATE PROPERTIES TRUST
ONE PENN PLAZA
NEW YORK, NEW YORK 10119
(212) 692-7200
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 26, 2004
------------------------
To the Shareholders of
Lexington Corporate Properties Trust:
The 2004 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 Wednesday, May 26,
2004, at 10:00 a.m., New York City time, for the following purposes:
(1) to elect nine trustees to serve until the 2005 Annual Meeting of
Shareholders; and
(2) to transact such other business as may properly come before the 2004
Annual Meeting.
Only holders (the "Shareholders") of record at the close of business on
April 12, 2004 are entitled to notice of and to vote at the 2004 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, New York, New York 10119, during the ten days
preceding the 2004 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 19, 2004
PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN
THE ENVELOPE PROVIDED WHETHER OR NOT YOU PLAN TO ATTEND THE 2004 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
NEW YORK, NEW YORK 10119
(212) 692-7200
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 26, 2004
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 2004 Annual Meeting of
Shareholders, and at any adjournments thereof (the "Annual Meeting"), to be held
on Wednesday, May 26, 2004, at the offices of Paul, Hastings, Janofsky & Walker
LLP, 75 East 55th Street, New York, New York 10022 at 10:00 a.m. New York City
time. This Proxy Statement and the related proxy card are first being sent to
the holders (the "Shareholders") of common shares, par value $0.0001 per share
(the "Common Shares") of the Company on or about April 19, 2004.
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, 2003, including financial statements audited by KPMG LLP, the
Company's independent auditors, and their report thereon dated February 24,
2004, 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 April 12, 2004 (the "Record Date") are entitled to vote at the
Annual Meeting. On the Record Date, there were outstanding 48,107,459 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 the election of the
nine nominees to serve as trustees until the 2005 Annual Meeting of
Shareholders.
Assuming a quorum is present at the Annual Meeting, 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. 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 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, 2004, (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, 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........................................ 2,102,864(2) 4.24%
Richard J. Rouse......................................... 428,995(3) *
T. Wilson Eglin.......................................... 343,210(4) *
Patrick Carroll.......................................... 242,351(5) *
William N. Cinnamond..................................... 52,521(6) *
Geoffrey Dohrmann........................................ 26,426(7) *
Carl D. Glickman......................................... 185,538(8) *
James Grosfeld........................................... 2,911 *
Kevin W. Lynch........................................... 5,755 *
Stanley R. Perla......................................... 4,946
Seth M. Zachary.......................................... 45,342 *
All trustees and named executive officers as a group (11 3,440,859 6.92%
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) 1,451,183 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 exchangeable, on a one-for-one basis, for Common Shares,
(ii) 288,976 Common Shares held in a trust established by the Company which
Mr. Roskind is the beneficiary and (iii) 53,547 Common Shares owned of
record by Mr. Roskind's wife, which Common Shares Mr. Roskind disclaims
beneficial ownership of.
(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 exchangeable, on a one-for-one basis, for Common Shares and (ii) 164,140
Common Shares held in a trust established by the Company which Mr. Rouse is
the beneficiary.
(4) Includes 228,080 Common Shares held in a trust established by the Company
which Mr. Eglin is the beneficiary.
(5) Includes (i) options to purchase 50,178 Common Shares at exercise prices
ranging from $11.8125 -- $15.50 per share and (ii) 59,306 Common Shares held
in a trust established by the Company which Mr. Carroll is the beneficiary.
(6) Includes 21,511 Common Shares held in a trust established by the Company
which Mr. Cinnamond is the beneficiary.
3
(7) Includes options to purchase 9,809 Common Shares at an exercise price of
$15.50 per share.
(8) Includes options to purchase 25,000 Common Shares at exercise prices ranging
from $9.00 -- $15.50 per share.
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
2003 fiscal year the Company's trustees and executive officers complied with all
Section 16(a) filing requirements applicable to them, except that (i) Mr.
Carroll inadvertently omitted the exercise of 3,406 non-qualified common share
options from his Form 4 filed on August 20, 2003, the transaction was reported
on a Form 4/A filed on March 22, 2004; and (ii) Mr. Glickman inadvertently
omitted the acquisition of 244 common shares from his Form 4 filed on August 20,
2003, this transaction was reported on a Form 4/A filed on November 21, 2003.
Additionally, Mr. Wood inadvertently omitted the disposition of 1,217 common
shares in connection with an option exercise on July 29, 2002. As a result, the
amount of securities beneficially owned as set forth in Table I was incorrect
for his Form 4 filed on each of July 29, 2002, January 7, 2003, February 4,
2003, March 7, 2003, September 22, 2003, February 12, 2004 and March 26, 2004.
This discrepancy was corrected in a Form 4/A filed on March 30, 2004.
4
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 2005
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 59 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 58 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 39 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.
5
NAME BUSINESS EXPERIENCE
---- ------------------------------------------------------------
GEOFFREY DOHRMANN.................... Mr. Dohrmann has served as a trustee since August 2000. Mr.
Age 53 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 77 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., and Cleveland State University.
JAMES GROSFELD....................... Mr. Grosfeld has served as a trustee since November 2003. He
Age 66 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 51 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 August 2003. Mr.
Age 60 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 51 Since 1987, Mr. Zachary has been a partner, and is currently
the Chairman, of the law firm Paul, Hastings, Janofsky &
Walker LLP, counsel to the Company.
6
MANAGEMENT
BOARD OF TRUSTEES AND COMMITTEES OF THE BOARD OF TRUSTEES
The Board of Trustees of the Company held nineteen meetings during the
fiscal year ended December 31, 2003. 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. 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 Governance Committee and the Executive Committee.
Audit Committee. The principal functions of the Audit Committee include
engaging the independent public accountants, reviewing with the independent
public accountants plans and results of the audit engagement, approving
professional services provided by the independent public accountants, 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, 2003, the Audit Committee was comprised of Messrs.
Dohrmann, Lynch and Perla, all of whom were determined by the Board of Trustees
to be "independent" as defined in Section 10A of 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(f) 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 "Company Profile/ Corporate Governance." Such
document is not deemed incorporated by reference into this Proxy Statement.
During the fiscal year ended December 31, 2003, the Audit Committee met four
times, including quarterly telephonic meetings with management and the
independent accountants, to discuss matters concerning, among other matters,
financial accounting matters and the audit of the Company's consolidated
financial statements for the year ended December 31, 2003.
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 "Company Profile/Corporate Governance." Such
document is not deemed incorporated by reference into this Proxy Statement. As
of December 31, 2003, the Compensation Committee was comprised of Messrs.
Dohrmann, Grosfeld, Lynch 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, 2003, the Compensation Committee met once.
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, 2003, the
Executive Committee was comprised of Messrs. Eglin, Glickman and Roskind. During
the fiscal year ended December 31, 2003, the Executive Committee met three
times.
Nominating and Governance Committee. The principal function of the
Nominating and 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 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 "Company Profile/Corporate Governance." Such document
is not deemed incorporated by reference into this Proxy Statement. As of
December 31, 2003, the Nominating and Governance Committee was comprised of
Messrs. Dohrmann and Glickman, each of whom are "independent" as defined by the
applicable listing standards of the New York Stock Exchange. The Nominating and
Governance Committee met four times during 2003. The Nominating and Governance
Committee does not currently intend to consider trustee nominations by
Shareholders.
7
The Board of Trustees and the Nominating and 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
Governance Committee's assessment includes consideration of issues of judgment,
diversity, age, expertise and experience. The Nominating and 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
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 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
21, 2003.
SHAREHOLDER COMMUNICATIONS
Shareholders wishing to communicate with the Board of Trustees should
address their inquiries to the Company's Chief Financial Officer by mail sent to
the Company's principal executive office located at One Penn Plaza, Suite 4015,
New York, New York, 10119. 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.
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 2005 Annual Meeting of
Shareholders, is a partner of Paul, Hastings, Janofsky & Walker LLP, which is
the general counsel to the Company. The Company, including all non-consolidated
joint ventures, paid Paul, Hastings, Janofsky & Walker LLP approximately
$1,275,000 for services during 2003. The Company intends to continue to retain
the services of Paul, Hastings, Janofsky & Walker LLP for general, real estate,
corporate and other matters.
8
COMPENSATION OF EXECUTIVE OFFICERS
Summary of Cash and Certain Other Compensation. The following table sets
forth the summary compensation to the Chairman of the Board of Trustees and the
four other most highly paid executive officers of the Company for the calendar
years 2003, 2002 and 2001.
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
-----------------------------------
PAYOUTS
AWARDS ---------
ANNUAL OTHER ----------------------- LONG TERM
COMPENSATION ANNUAL RESTRICTED SECURITIES INCENTIVE ALL OTHER
FISCAL ----------------- COMPEN- SHARE UNDERLYING PLAN COMPEN-
NAME AND YEAR SALARY BONUS SATION AWARDS OPTIONS PAYOUTS SATION
PRINCIPAL POSITION ENDED ($) ($)(1) ($) ($)(2) (#)(3) ($) ($)(4)
------------------ -------- ------- ------- ------- ---------- ---------- --------- ---------
E. Robert Roskind(5)........ 12/31/03 350,000 23,583 -- 752,865 -- -- 2,772
Chairman of the Board 12/31/02 320,000 23,333 -- 174,174 50,000 -- 640
of Trustees 12/31/01 315,000 83,700 -- 259,875 70,000 -- 835
Richard J. Rouse(5)......... 12/31/03 300,000 231,250 -- 1,459,048 -- -- 3,412
Vice Chairman and 12/31/02 270,000 21,250 -- 138,229 50,000 -- 640
Chief Investment Officer 12/31/01 250,000 68,185 -- 236,250 100,000 -- 835
T. Wilson Eglin(5).......... 12/31/03 310,000 238,658 -- 1,466,346 -- -- 1,974
Chief Executive Officer, 12/31/02 275,000 21,458 -- 141,004 50,000 -- 640
President and Chief 12/31/01 255,000 69,362 -- 236,250 100,000 -- 835
Operating Officer
Patrick Carroll(6).......... 12/31/03 250,000 194,208 -- 925,030 -- -- 1,512
Chief Financial Officer, 12/31/02 220,000 19,167 -- 113,352 50,000 -- 640
Treasurer and Executive 12/31/01 205,000 57,462 -- 141,750 75,000 -- 835
Vice President
William N. Cinnamond(7)..... 12/31/03 240,000 110,000 -- 413,829 -- -- 660
Senior Vice President 12/31/02 220,000 19,167 -- 85,002 50,000 -- 640
12/31/01 73,000 137,933 -- -- 50,000 -- 278
---------------
(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. As part of his employment agreement, Mr. Cinnamond was guaranteed a
cash bonus of $135,000 relating to 2001.
Share Options. No Common Share options were granted during the fiscal year
ended December 31, 2003 to any of the executive officers named in the Summary
Compensation Table. Since inception, the Company has not granted any share
appreciation or dividend equivalent rights.
Option Exercises/Value of Unexercised Options. The following table sets
forth certain information concerning the exercise of share options during the
fiscal year ended December 31, 2003 by the executive
9
officers named in the Summary Compensation Table, and the year-end value of
unexercised options held by such persons.
SHARE OPTION EXERCISES IN FISCAL YEAR 2003
AND FISCAL YEAR-END OPTION VALUES
VALUE OF UNEXERCISED
SHARES NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED OPTIONS AT FISCAL YEAR-END AT FISCAL YEAR-END
ON VALUE --------------------------- ---------------------------
EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
NAME (#) ($) (#) (#) ($) ($)
---- -------- -------- ----------- ------------- ----------- -------------
E. Robert Roskind.......... 86,919 406,694 0 42,500 0 263,856
Richard J. Rouse........... 146,438 550,744 0 50,000 0 326,688
T. Wilson Eglin............ 120,750 438,232 0 50,000 0 326,688
Patrick Carroll............ 79,216 329,671 63,503 43,750 430,434 274,328
William N. Cinnamond....... 16,268 57,277 53,732 25,000 300,847 117,250
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 receive an
additional $7,500 per annum. 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 2003, all
trustees elected to receive 100% of their trustee fees in Common Shares.
Effective January 1, 2003, all non-employee trustees received, in addition to
the fees described above, 2,000 nonvested common shares.
EMPLOYMENT AGREEMENTS
The Company has entered into an employment agreement with each of Messrs.
Roskind, Rouse, Eglin, Carroll and Cinnamond 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), two times (for Mr. Cinnamond) 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, two years for Mr. Cinnamond and one year
for Mr. Wood.
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
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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, 2003, the Audit Committee was comprised of Messrs. Dohrmann,
Lynch and Perla.
Management is responsible for the Company's internal controls and financial
reporting process. The independent accountants are 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, and to issue a report thereon. The Audit Committee's responsibility is
to monitor and oversee these processes.
In connection with these responsibilities, the Audit Committee met with
management and the independent accountants to review and discuss the December
31, 2003 audited consolidated financial statements. The Audit Committee has
discussed with the independent accountants 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 accountants required by
Independence Standards Board Standard No. 1 (Independence Discussions with Audit
Committees), and the Audit Committee discussed with the independent accountants
that firm's independence.
Based upon the Audit Committee's discussions of the foregoing with
management and the independent accountants, and the Audit Committee's review of
the representations of management, the Audit Committee recommended that the
Board of Trustees include the December 31, 2003 audited consolidated financial
statements in the Company's Annual Report on Form 10-K for the year ended
December 31, 2003, to be filed with the Securities and Exchange Commission.
Audit Committee of the Board of
Trustees
Geoffrey Dohrmann
Kevin W. Lynch
Stanley R. Perla
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As of December 31, 2003, the Compensation Committee consisted of Messrs.
Dohrmann, Grosfeld, Lynch and Perla. None of Messrs. Dohrmann, Grosfeld, Lynch
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, 2003, 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 2003, 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
11
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 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 2003, 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 2003 and salary and bonus programs for 2004.
Compensation Committee of the Board of
Trustees
Geoffrey Dohrmann
James Grosfeld
Kevin W. Lynch
Stanley R. Perla
12
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,
1998 through December 31, 2003 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, 1998 (and the reinvestment of all dividends).
THE PERIOD OF DECEMBER 31, 1998 THROUGH DECEMBER 31, 2003
[PERFORMANCE GRAPH]
--------------------------------------------------------------------------------------
Company/Index Name 12/31/98 12/31/99 12/31/00 12/31/01 12/31/02 12/31/03
--------------------------------------------------------------------------------------
Lexington Corporate
Properties Trust $100.00 $ 81.10 $116.10 $166.99 $186.43 $255.33
NAREIT Equity REIT
Total Return Index $100.00 $ 95.38 $120.53 $137.32 $142.57 $195.51
Russell 2000 Index $100.00 $121.26 $118.15 $121.09 $ 96.28 $144.07
S&P 500 Index $100.00 $121.04 $110.02 $ 96.94 $ 75.52 $ 97.18
OTHER MATTERS
The Board of Trustees is not aware of any business to come before the
Annual Meeting other than the election of trustees. 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.
13
APPOINTMENT OF INDEPENDENT AUDITORS
Independent Public Accountant, KPMG LLP, was engaged to perform the annual
audit of the consolidated financial statements of the Company for the calendar
year ended December 31, 2003. There are no affiliations between the Company and
its partners, associates or employees, other than as pertaining to its
engagement as independent auditors 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 public accountants for the year
ending December 31, 2004 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 public accountants 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 2003 and 2002, and fees billed for other services rendered by KPMG LLP.
2003 2002
-------- --------
Audit fees(1)............................................... $278,044 $182,500
Audit related fees.......................................... -- --
-------- --------
Audit and audit related fees.............................. $278,044 $182,500
Tax fees(2)................................................. $ 87,000 $ 82,000
All other fees(3)........................................... $ 1,461 --
-------- --------
Total fees................................................ $366,505 $264,500
======== ========
---------------
(1) Audit fees include services rendered relating to the Company's 2003 and 2002
common share and preferred share offerings.
(2) Tax fees consisted of fees for tax compliance services.
(3) 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 accountants 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 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.
14
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 $7,000 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, no
later than December 20, 2004. 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.
15
THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS Please
INDICATED, WILL BE VOTED "FOR" THE PROPOSALS. Mark Here |_|
for Address
Change or
Comments
SEE REVERSE SIDE
ITEM 1. ELECTION OF TRUSTEES
WITHHELD
FOR FOR ALL
|_| |_|
Nominees:
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 TRANSACT SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE 2004
ANNUAL MEETING.
FOR AGAINST ABSTAIN
|_| |_| |_|
Consenting to receive all future annual meeting materials and shareholder
communications electronically is simple and fast! Enroll today at
www.melloninvestor.com/ISD for secure online access to your proxy materials,
statements, tax documents and other important shareholder correspondence.
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.
--------------------------------------------------------------------------------
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.eproxy.com/lxp 1-800-435-6710
Mark, sign and date
Use the Internet to vote your proxy. Use any touch-tone telephone to your proxy card
Have your proxy card in hand when OR vote your proxy. Have your proxy OR and
you access the web site. card in hand when you call. return it in the
enclosed postage-paid
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 26, 2004 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)
________________________________________________________________________________
________________________________________________________________________________
--------------------------------------------------------------------------------
FOLD AND DETACH HERE
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