Filed Pursuant to Rule 424(b)(5)
Registration Statement No. 333-231085
Subject to Completion, Dated
May 13, 2020
The information in this preliminary prospectus
supplement is not complete and may be changed. This preliminary prospectus supplement and the accompanying prospectus are not offers
to sell these securities and the issuer is not soliciting offers to buy these securities in any jurisdiction where the offer or
sale is not permitted.
PRELIMINARY PROSPECTUS SUPPLEMENT
(To prospectus dated April 19, 2019)
5,000,000 Shares
Common
Stock
We are offering 5,000,000 shares of common stock (“common
stock”) of Vector Group Ltd. (the “Company”).
Our common stock is traded on the New York Stock Exchange (the
“NYSE”) under the symbol “VGR”. On May 12, 2020, the last reported sale price of our common stock on the
NYSE was $11.49 per share.
We will receive all of the net proceeds of the offering. We
intend to use the proceeds of the offering for general corporate purposes.
Richard J. Lampen, our Executive Vice President, and J. Bryant Kirkland III, our Senior Vice President, Chief Financial Officer
and Treasurer, have indicated their preliminary interest in purchasing an aggregate of 37,500 shares of common
stock in this offering from the underwriter at the public offering price.
The underwriter has agreed to purchase the shares of common
stock from us at a price of $ per share, which will result in $ of proceeds to us before expenses. The
underwriter may offer the shares of our common stock for sale from time to time in one or more transactions on the NYSE, in the
over-the-counter market, through negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices
related to prevailing market prices or at negotiated prices, subject to its right to reject any order in whole or in part. See
“Underwriting.”
Investing in our securities involves risk. See “Risk
Factors” on page S-3 of this prospectus supplement and in the documents incorporated by reference into this prospectus.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying
prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
We have granted the underwriter an option, exercisable for up to 30 days after the date of this prospectus supplement, to
purchase from us up to an additional 750,000 shares of our common stock at the offering price.
The underwriter expects to deliver the shares
against payment in New York, New York on May , 2020.
Jefferies
Prospectus
Supplement dated May , 2020.
TABLE OF CONTENTS
Prospectus Supplement
Prospectus
ABOUT THIS PROSPECTUS SUPPLEMENT
We provide information to you about this offering
in two separate documents. The accompanying prospectus provides general information about us and the securities we may offer from
time to time, some of which do not apply to this offering. This prospectus supplement provides additional information about us
and describes the specific details regarding this offering and the securities offered hereby. Generally, when we refer to this
prospectus, we are referring to both this prospectus supplement and the accompanying prospectus combined. To the extent there is
a conflict between the information contained in this prospectus supplement, on the one hand, and the information contained in the
accompanying prospectus or in any document incorporated by reference that was filed with the Securities and Exchange Commission,
or the SEC, before the date of this prospectus supplement, on the other hand, you should rely on the information in this prospectus
supplement.
As permitted under the rules of the SEC, this
prospectus incorporates important business information about Vector Group Ltd. that is contained in documents that we file with
the SEC, but that are not included in or delivered with this prospectus. You may obtain copies of these documents, without charge,
from the web site maintained by the SEC at www.sec.gov, as well as other sources. See “Where You Can Find More Information.”
Before purchasing any securities, you should carefully read this prospectus together with the additional information described
under the headings “Where You Can Find More Information” and “Information We Incorporate by Reference.”
You should rely only on the information contained
or incorporated by reference in this prospectus and any free writing prospectus prepared by or on behalf of us or to which we have
referred you. Neither we nor the underwriter have authorized any other person to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on it. We take no responsibility for, and can provide
no assurance as to the reliability of, any other information that others may give you. You should assume that the information contained
in this prospectus or any free writing prospectus is accurate as of the date on its respective cover, and that any information
incorporated by reference is accurate only as of the date of the document incorporated by reference, unless we indicate otherwise.
Our business, financial condition, results of operations and prospects may have changed since those dates.
Neither we nor the underwriter is making offers
to sell the securities described in this prospectus in any jurisdiction in which an offer or solicitation is not authorized or
in which the person making such offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make an
offer or solicitation.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports,
proxy statements and other information with the SEC. Our SEC filings, including the registration statement of which the accompanying
prospectus is a part and the exhibits to such registration statement, are available to the public at the SEC’s web site at
www.sec.gov. These documents may also be accessed on our web site at www.vectorgroupltd.com. Information contained on our web site
is not incorporated by reference into this prospectus and you should not consider information contained on our web site to be part
of this prospectus.
This prospectus supplement is part of a registration
statement filed with the SEC and does not contain all of the information in the registration statement. The full registration statement
may be obtained from the SEC or us as indicated above. Forms of documents establishing the terms of the offered securities are
filed as exhibits to the registration statement or will be filed through an amendment to our registration statement on Form S-3
or under cover of a Current Report on Form 8-K and incorporated in this prospectus supplement by reference. Statements in this
prospectus supplement about these documents are summaries and each statement is qualified in all respects by reference to the document
to which it refers. You should refer to the actual documents for a more complete description of the relevant matters.
INFORMATION WE INCORPORATE BY REFERENCE
The SEC allows us to “incorporate by
reference” in this prospectus the information we file with it, which means that we can disclose important information to
you by referring you to those documents. The information incorporated by reference is considered to be part of this prospectus,
and later information filed with the SEC will automatically update and supersede the information included or incorporated by reference
in this prospectus. We incorporate by reference in this prospectus the following information (other than, in each case, documents
or information deemed to have been furnished and not filed in accordance with SEC rules):
We also incorporate by reference each of the
documents that we file with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), on or after the date of this prospectus and prior to the termination of the offering under this
prospectus. We will not, however, incorporate by reference in this prospectus any documents or portions thereof that are not deemed
“filed” with the SEC, including any information furnished pursuant to Item 2.02 or Item 7.01 of our Current Reports
on Form 8-K after the date of this prospectus unless, and except to the extent, specified in such Current Reports.
We will provide to each person, including
any beneficial owner, to whom a prospectus is delivered, a copy of any of these filings (other than an exhibit to these filings,
unless the exhibit is specifically incorporated by reference into the filing requested) at no cost, upon a request to us by writing
or telephoning us at the following address and telephone number:
Vector Group Ltd.
4400 Biscayne Boulevard
Miami, Florida 33137
Telephone Number: (305) 579-8000
SPECIAL NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This prospectus, including the documents incorporated
by reference, contains “forward looking statements” within the meaning of the federal securities law. Forward-looking
statements include information relating to our intent, belief or current expectations, primarily with respect to, but not limited
to:
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legislation and regulations;
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related industry developments (including trends affecting our business, financial condition and results of operations).
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You can identify forward-looking statements
by terminology such as “anticipate,” “believe,” “estimate,” “expect,” “intend,”
“may be,” “objective,” “plan,” “seek,” “predict,” “project”
and “will be” and similar words or phrases or their negatives.
The forward-looking information involves important
risks and uncertainties that could cause our actual results, performance or achievements to differ materially from our anticipated
results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results
to differ materially from those suggested by the forward-looking statements include, without limitation, the following:
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general economic and market conditions and any changes therein, due to acts of war and terrorism or otherwise,;
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governmental regulations and policies;
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adverse changes in global, national, regional and local economic and market conditions, including those related to pandemics
and health crises, such as the recent outbreak of Coronavirus (“COVID-19”);
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significant changes in the price, availability or quality of tobacco, other raw materials or component parts, including as
a result of the COVID-19 pandemic;
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potential dilution to our holders of or common stock as a result of issuances of additional shares of common stock to fund
our financial obligations and other financing activities;
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the impacts of the Tax Cuts and Jobs Act of 2017, including the deductibility of interest expense and the impact of the markets
on our Real Estate segment,
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effects of industry competition;
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impact of business combinations, including acquisitions and divestitures, both internally for us and externally in the tobacco
industry;
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impact of legislation on our results of operations and product costs, i.e. the impact of federal legislation providing for
regulation of tobacco products by the Food and Drug Administration (the “FDA”);
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impact of substantial increases in federal, state and local excise taxes;
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uncertainty related to product liability and other tobacco-related litigation including the Engle progeny cases pending in
Florida and other individual and class action cases where certain plaintiffs have alleged compensatory and punitive damage amounts
ranging into the hundreds of million and even billions of dollars;; and
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potential additional payment obligations for us under the Master Settlement Agreement and other settlement agreements with
the states.
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Any forward-looking statement you read in
this prospectus reflects our current views with respect to future events and is subject to these and other risks, uncertainties
and assumptions relating to our operations, operating results, growth strategy and liquidity. We urge you to carefully review the
disclosures we make concerning risks and other factors that may affect our business and operating results, including those made
under the heading “Risk Factors” in this prospectus and in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2019 and our Quarterly Report on Form 10-Q for the quarterly period ending March 31, 2020, as such risk factors may
be amended, supplemented or superseded from time to time by other reports we file with the SEC in the future, including subsequent
Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. We caution you that any forward-looking statements made in this
prospectus and the documents incorporated herein by reference are not guarantees of future performance, and you should not place
undue reliance on these forward-looking statements, which speak only as of the date of this prospectus or any other document incorporated
by reference into this prospectus. We do not intend, and we undertake no obligation, to update any forward-looking information
to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events, unless
required by law to do so.
MARKET DATA
We use market and industry data throughout
this prospectus and the documents incorporated by reference herein that we have obtained from market research, publicly available
information and industry publications, including industry data obtained from Management Science Associates, Inc. (“Management
Science Associates”), an independent third-party data management organization that collects wholesale and retail shipment
data from various cigarette manufacturers and distributors and provides analysis of market share and unit sales volume for individual
companies and the industry as a whole. These sources generally state that the information that they provide has been obtained from
sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. The market and industry
data is often based on industry surveys and the preparers’ experience in the industry. Management Science Associates’
information relating to unit sales volume and market share of certain smaller, primarily deep discount, cigarette manufacturers
is based on estimates developed by Management Science Associates. We have not independently verified this information.
SUMMARY
This summary highlights information contained
elsewhere in this prospectus. Because it is a summary, it does not contain all of the information that you should consider before
investing, and it is qualified in its entirety by the more detailed information and historical financial statements (including
the notes to those financial statements) that are included elsewhere herein or that are incorporated by reference in this prospectus.
You should read the entire prospectus and all of the documents that are incorporated herein by reference carefully, including the
“Risk Factors” sections and the financial statements and the notes to those statements. As used in this prospectus,
the terms “Vector,” “Vector Group,” “we,” “our” and “us” and similar
terms refer to Vector Group Ltd. and all of our consolidated subsidiaries, including VGR Holding LLC (“VGR Holding”),
Liggett Group LLC (“Liggett Group” or “Liggett”), Vector Tobacco Inc. (“Vector Tobacco”) and
New Valley LLC (“New Valley”).
Vector Group Ltd.
We are a holding company and are principally engaged in two
business segments:
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Tobacco: the manufacture and sale of cigarettes in the United States
through our Liggett Group and Vector Tobacco subsidiaries; and
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Real Estate: the real estate business through our New Valley subsidiary,
which is seeking to acquire or invest in additional real estate properties or projects. New Valley owns 100% of Douglas Elliman
Realty, LLC (“Douglas Elliman”), which operates the largest residential brokerage company in the New York metropolitan
area and also conducts residential real estate brokerage operations in Florida, California, Connecticut, Massachusetts, Colorado,
New Jersey and Texas.
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Corporate Information
Our principal executive offices are located
at 4400 Biscayne Boulevard, Miami, Florida 33137, our telephone number is (305) 579-8000 and our web site is http://www.vectorgroupltd.com.
You should not consider information contained on our web site or that can be accessed through our web site to be part of this prospectus.
Our common stock is listed on the New York Stock Exchange under the symbol “VGR”.
THE OFFERING
The following summary of the offering contains
basic information about the offering and the common stock and is not intended to be complete. It does not contain all the information
that may be important to you. For a more complete understanding of the common stock, please refer to the section of the accompanying
prospectus entitled “Description of Capital Stock.”
Issuer
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Vector Group Ltd., a Delaware corporation
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Common stock offered by us
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5,000,000 shares
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Common stock outstanding prior
to the offering
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148,084,900 shares
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Common stock outstanding upon completion of the offering
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153,084,900 shares (153,834,900 shares if the
underwriter exercises its option to purchase additional shares in full).
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Option to purchase additional shares
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We have granted the underwriter an option, exercisable for 30 days from the date of this prospectus, to purchase up to 750,000 additional shares.
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Use of proceeds
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We intend to use the proceeds of the offering for general corporate purposes. See “Use of Proceeds.”
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Risk factors
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You should carefully read and consider the information set forth under “Risk Factors” beginning on page S-3 in this prospectus supplement, beginning on page 4 in the accompanying prospectus and in the documents incorporated by reference herein, including our Annual Report on Form 10-K for the year ended December 31, 2019 and our Quarterly Report on Form 10-Q for the quarterly period ending March 31, 2020, before investing in our common stock.
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Underwriter conflicts of interest
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See “Underwriting.”
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NYSE symbol
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“VGR”
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RISK FACTORS
Before you decide to invest in our common
stock, you should be aware that an investment in our common stock involves various risks and uncertainties, including those described
below, that could have a material adverse effect on our business, financial position, results of operations, cash flows or prospects.
We urge you to consider carefully the risk factors described below, together with all of the other information included in, and
incorporated by reference into, this prospectus before you decide to invest in the borrowed shares. The risks and uncertainties
described below and incorporated by reference into this prospectus are not the only ones related to our business, our common stock
or the offering. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also materially
and adversely affect our business, financial position, results of operations, cash flows or prospects. The trading price of our
common stock could decline due to the materialization of any of these risks and uncertainties and you may lose all or part of your
investment. To the extent the COVID-19 pandemic adversely affects our business and financial results, it may also have the effect
of increasing many of the other risks described herein and in the aforementioned documents that are incorporated by reference
herein.
The price of our common stock may fluctuate
significantly, and you could lose all or part of your investment.
The trading price of our common stock has
ranged between $7.92 and $14.42 per share over the past 52 weeks. We expect that the market price of our common stock will continue
to fluctuate.
The market price of our common stock may fluctuate in response
to numerous factors, many of which are beyond our control. These factors include the following:
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actual or anticipated fluctuations in our operating results;
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changes in expectations as to our future financial performance, including
financial estimates by securities analysts and investors;
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the operating and stock performance of our competitors;
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announcements by us or our competitors of new products or services
or significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments;
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the initiation or outcome of litigation;
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FDA regulation of our products including, determinations that certain
of our new tobacco products are not substantially equivalent to a predicate tobacco product;
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the failure or significant disruption of our operations from various
causes related to our critical information technologies and systems including cybersecurity threats to our data and customer data
as well as reputational or financial risks associated with a loss of any such data;
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changes in interest rates;
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general economic, market and political conditions;
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additions or departures of key personnel; and
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future sales of our equity or convertible securities.
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We cannot predict the extent, if any, to which future sales
of shares of common stock or the availability of shares of common stock for future sale, may depress the trading price of our common
stock.
In addition, the stock market in recent years
has experienced extreme price and trading volume fluctuations that often have been unrelated or disproportionate to the operating
performance of individual companies. These broad market fluctuations may adversely affect the price of our common stock, regardless
of our operating performance. Furthermore, stockholders may initiate securities class action lawsuits if the market price of our
stock drops significantly, which may cause us to incur substantial costs and could divert the time and attention of our management.
These factors, among others, could significantly depress the price of our common stock.
We have potentially dilutive securities
outstanding.
As of March 31, 2020, we had outstanding options granted to employees representing 4,443,346 shares of our common stock, with a weighted-average exercise price of
$14.80 per share, of which options for 3,160,677 shares were exercisable as of March 31, 2020. The issuance of these shares
will cause dilution which may adversely affect the market price of our common stock and increase our dividend payment. The
availability for sale of significant quantities of our common stock could adversely affect the prevailing market price of the
stock. In addition, our outstanding shares of 148,084,900 as of March 31, 2020 included 1,084,789 restricted shares granted to employees
and non-employee directors that are subject to future vesting requirements.
We are a holding company and depend
on cash payments from our subsidiaries, which are subject to contractual and other restrictions, in order to service our debt and
to pay dividends on our common stock.
We are a holding company and have no operations
of our own. We hold our interests in our various businesses through our wholly-owned subsidiaries, VGR Holding and New Valley.
In addition to our own cash resources, our ability to pay interest on our debt and to pay dividends on our common stock depends
on the ability of VGR Holding and New Valley to make cash available to us. VGR Holding’s ability to pay dividends to us depends
primarily on the ability of Liggett and Vector Tobacco, its wholly-owned subsidiaries, to generate cash and make it available to
VGR Holding. Liggett's revolving credit agreement with Wells Fargo Bank, N.A. contains a restricted payments test that limits the
ability of Liggett to pay cash dividends to VGR Holding. The ability of Liggett to meet the restricted payments test may be affected
by factors beyond its control, including Wells Fargo’s unilateral discretion, if acting in good faith, to modify elements
of such test.
Our receipt of cash payments, as dividends
or otherwise, from our subsidiaries is an important source of our liquidity and capital resources. If we do not have sufficient
cash resources of our own and do not receive payments from our subsidiaries in an amount sufficient to repay our debts and to pay
dividends on our common stock, we must obtain additional funds from other sources. There is a risk that we will not be able to
obtain additional funds at all or on terms acceptable to us. Our inability to service these obligations and to continue to pay
dividends on our common stock would significantly harm us and the value of our common stock.
Future changes in tax law may have an
adverse effect on our business, financial condition and results of operations and affect the federal tax considerations of the
purchase, ownership and disposition of the common stock.
The rules dealing with U.S. federal, state,
and local income taxation are constantly under review by persons involved in the legislative process and by the Internal Revenue
Service and the U.S. Treasury Department. Future changes in tax laws (which changes may have retroactive application) could have
an adverse effect on our business, financial condition and results of operations. Such changes may also affect the federal tax
considerations of the purchase, ownership and disposition of the common stock.
USE OF PROCEEDS
We estimate that the proceeds from this
offering will be approximately $ million, or approximately
$ million if the underwriter exercises its option to
purchase additional shares in full, based on the price of $
per share, after deducting estimated fees and expenses
payable by us. We intend to use the proceeds of the offering for general corporate purposes.
CAPITALIZATION
The following table sets forth our cash and
cash equivalents and total capitalization as of March 31, 2020 on:
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an as adjusted basis to give effect to this offering of common stock. The as adjusted column assumes no exercise by the underwriter
of its option to purchase additional shares.
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The information presented in the table below
should be read in conjunction with the historical consolidated financial statements and the notes thereto incorporated by reference
into this prospectus.
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As of March 31, 2020
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Actual
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As Adjusted
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(dollars in thousands)
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Cash and cash equivalents
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$
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467,264
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$
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(1)
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Vector:
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6.125% Senior Secured Notes due 2025
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$
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850,000
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$
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850,000
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10.5% Senior Notes due 2026(2)
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555,000
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555,000
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5.5% Variable Interest Senior Convertible Debentures due 2020(3)
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169,610
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169,610
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Liggett:
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Revolving credit facility
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24,498
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24,498
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Equipment loans
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245
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245
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Other
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27,639
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27,639
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Total notes payable, long-term debt and other obligations, including current portion
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1,626,992
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1,626,992
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Total stockholders’ deficiency
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(718,999
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(1)
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Total capitalization
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$
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907,993
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$
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(1)
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_____________
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(1)
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Reflects net proceeds of this offering of common shares of $ million paid by Jefferies LLC.
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(2)
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Amount included in the table above includes unamortized
discount of approximately $3.3 million
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(3)
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The 5.5% Variable Interest Senior Convertible Debentures
matured and were retired on April 15, 2020.
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MATERIAL UNITED STATES TAX CONSEQUENCES TO
NON-U.S. HOLDERS OF COMMON STOCK
This section summarizes certain U.S. federal
income and estate tax consequences of the ownership and disposition of our common stock by a non-U.S. holder. You are a non-U.S.
holder if you are, for U.S. federal income tax purposes, a beneficial owner of our common stock and you are:
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a nonresident alien individual,
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a foreign corporation, or
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an estate or trust that in either case is not subject to U.S. federal income tax on a net income basis on income or gain from
common stock.
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This section does not consider the specific
facts and circumstances that may be relevant to a particular non-U.S. holder and does not address the treatment of a non-U.S. holder
under the laws of any state, local or non-U.S. taxing jurisdiction. This section is based on the tax laws of the United States,
including the Internal Revenue Code of 1986, as amended (the “Code”), existing and proposed regulations, and administrative
and judicial interpretations, all as currently in effect. These laws are subject to change, possibly on a retroactive basis.
If any entity or arrangement that is treated
as a partnership for U.S. federal income tax purposes holds our common stock, the U.S. federal income tax treatment of a partner
will generally depend on the status of the partner and the tax treatment of the partnership. A partner in a partnership holding
our common stock should consult its tax advisor with regard to the U.S. federal income tax treatment of an investment in our common
stock.
You should consult a tax advisor regarding
the U.S. federal tax consequences of acquiring, holding and disposing of our common stock in your particular circumstances, as
well as any tax consequences that may arise under the laws of any state, local or non-U.S. taxing jurisdiction.
Dividends
If we make a distribution of cash or other
property (other than certain distributions of our stock) in respect of our common stock, the distribution generally will be treated
as a dividend to the extent of our current or accumulated earnings and profits, as determined under United States federal income
tax principles. Any portion of a distribution that exceeds our current and accumulated earnings and profits will generally be treated
first as a tax-free return of capital, on a share-by-share basis, to the extent of your tax basis in our common stock (and will
reduce your basis in such common stock), and, to the extent such portion exceeds your tax basis in our common stock, the excess
will be treated as gain from the taxable disposition of the common stock, the tax treatment of which is discussed below under “Gain
on Disposition of Common Stock”.
Except as described below, if you are a non-U.S.
holder of our common stock, dividends paid to you are subject to withholding of U.S. federal income tax at a 30% rate or at a lower
rate if you are eligible for the benefits of an income tax treaty that provides for a lower rate. Subject to the discussion in
“FATCA Withholding” below, even if you are eligible for a lower treaty rate, we and other payors will generally be
required to withhold at a 30% rate (rather than the lower treaty rate) on dividend payments to you, unless you have furnished to
us or another payor:
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a valid Internal Revenue Service (“IRS”) Form W-8 or an acceptable substitute form upon which you certify, under
penalties of perjury, your status as a non-United States person and your entitlement to the lower treaty rate with respect to such
payments, or
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in the case of payments made outside the United States to an offshore account (generally, an account maintained by you at an
office or branch of a bank or other financial institution at any location outside the United States), other documentary evidence
establishing your entitlement to the lower treaty rate in accordance with U.S. Treasury regulations.
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If you are eligible for a reduced rate of
U.S. withholding tax under a tax treaty, you may obtain a refund of any amounts withheld in excess of that rate by filing a refund
claim with the IRS.
If dividends paid to you are “effectively
connected” with your conduct of a trade or business within the United States, and, if required by a tax treaty, the dividends
are attributable to a permanent establishment that you maintain in the United States, we and other payors generally are not required
to withhold tax from the dividends, provided that you have furnished to us or another payor a valid IRS Form W-8ECI or an
acceptable substitute form upon which you represent, under penalties of perjury, that:
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you are a non-U.S. person, and
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the dividends are effectively connected with your conduct of a trade or business within the United States and are includible
in your gross income.
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“Effectively connected” dividends
(and, if required by an applicable treaty, dividends attributable to a permanent establishment that you maintain in the United
States) are taxed at rates applicable to U.S. citizens, resident aliens and domestic U.S. corporations.
If you are a corporate non-U.S. holder, “effectively
connected” dividends that you receive may, under certain circumstances, be subject to an additional “branch profits
tax” at a 30% rate or at a lower rate if you are eligible for the benefits of an income tax treaty that provides for a lower
rate.
Gain on Disposition of Common Stock
If you are a non-U.S. holder, you generally
will not be subject to U.S. federal income tax on gain that you recognize on a disposition of our common stock unless:
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the gain is “effectively connected” with your conduct of a trade or business in the United States, and the gain
is attributable to a permanent establishment that you maintain in the United States, if that is required by an applicable income
tax treaty as a condition for subjecting you to U.S. taxation on a net income basis,
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you are an individual, you hold our common stock as a capital asset, you are present in the United States for 183 or more days
in the taxable year of the disposition and certain other conditions exist, or
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we are or have been a U.S. real property holding corporation for U.S. federal income tax purposes and you held, directly or
indirectly, at any time during the five-year period ending on the date of disposition, more than 5% of our common stock (assuming
our common stock remains regularly traded) and you are not eligible for any treaty exemption.
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If you are a non-U.S. holder and the gain
from the taxable disposition of shares of our common stock is effectively connected with your conduct of a trade or business in
the U.S. (and, if required by an applicable tax treaty, the gain is attributable to a permanent establishment that you maintain
in the United States), you will be subject to tax on the net gain derived from the sale at rates applicable to United States citizens,
resident aliens and domestic United States corporations. If you are a corporate non-U.S. holder, “effectively connected”
gains that you recognize may also, under certain circumstances, be subject to an additional “branch profits tax” at
a 30% rate, or at a lower rate if you are eligible for the benefits of an income tax treaty that provides for a lower rate.
If you are an individual non-U.S. holder described
in the second bullet point immediately above, you will be subject to a flat 30% tax (unless an applicable income tax treaty provides
otherwise) on the gain derived from the sale, which may be offset by U.S. source capital losses, even though you are not considered
a resident of the U.S.
We will be a United States real property holding
corporation at any time that the fair market value of our “United States real property interests,” as defined in the
Code and applicable Treasury Regulations, equals or exceeds 50% of the aggregate fair market value of our worldwide real property
interests and our other assets used or held for use in a trade or business (all as determined for the U.S. federal income tax purposes).
We believe that we are not, and do not anticipate becoming in the foreseeable future, a United States real property holding corporation.
FATCA Withholding
Pursuant to sections 1471 through 1474 of
the Code, commonly known as the Foreign Account Tax Compliance Act (“FATCA”), a 30% withholding tax (“FATCA withholding”)
may be imposed on certain payments to you or to certain foreign financial institutions, investment funds and other non-U.S. persons
receiving payments on your behalf if you or such persons fail to comply with certain information reporting requirements. Payments
of dividends that you receive in respect of our common stock could be affected by this withholding if you are subject to the FATCA
information reporting requirements and fail to comply with them or if you hold common stock through a non-U.S. person (e.g.,
a foreign bank or broker) that fails to comply with these requirements (even if payments to you would not otherwise have been subject
to FATCA withholding). You should consult your own tax advisors regarding the relevant U.S. law and other official guidance on
FATCA withholding.
Federal Estate Taxes
Common stock held by a non-U.S. holder at
the time of death will be included in the holder’s gross estate for U.S. federal estate tax purposes, unless an applicable
estate tax treaty provides otherwise.
Backup Withholding and Information Reporting
If you are a non-U.S. holder, we and other
payors are required to report payments of dividends on IRS Form 1042-S even if the payments are exempt from withholding. You are
otherwise generally exempt from backup withholding and information reporting requirements with respect to dividend payments and
the payment of the proceeds from the sale of common stock effected at a U.S. office of a broker, provided that either (i) the
payor or broker does not have actual knowledge or reason to know that you are a U.S. person and you have furnished a valid IRS
Form W-8 or other documentation upon which the payor or broker may rely to treat the payments as made to a non-U.S. person or (ii) you
otherwise establish an exemption.
Payment of the proceeds from the sale of common
stock effected at a foreign office of a broker generally will not be subject to information reporting or backup withholding. However,
a sale effected at a foreign office of a broker could be subject to information reporting in the same manner as a sale within the
United States (and in certain cases may be subject to backup withholding as well) if (i) the broker has certain connections
to the United States, (ii) the proceeds are paid or confirmation is sent to the United States or (iii) the sale has certain
other specified connections with the United States.
UNDERWRITING
Subject to the terms and conditions set forth
in the underwriting agreement, dated May , 2020, we have agreed to sell to Jefferies LLC, as underwriter, and Jefferies LLC has
agreed to purchase from us, all of the shares of common stock offered by this prospectus.
The underwriting agreement provides that the
obligations of the underwriter are subject to certain conditions precedent such as receipt by the underwriter of officers’
certificates and legal opinions and approval of certain legal matters by its counsel. The underwriting agreement provides that
the underwriter will purchase all of the shares of common stock if any of them are purchased.
We have agreed to indemnify the underwriter
and certain of its controlling persons against certain liabilities, including liabilities under the Securities Act, and to contribute
to payments that the underwriter may be required to make in respect of those liabilities.
The underwriter has advised us that, following
the completion of this offering, it currently intends to make a market in the common stock as permitted by applicable laws and
regulations. However, the underwriter is not obligated to do so, and the underwriter may discontinue any market-making activities
at any time without notice in its sole discretion. Accordingly, no assurance can be given as to the liquidity of the trading market
for the common stock, that you will be able to sell any of the common stock held by you at a particular time or that the prices
that you receive when you sell will be favorable.
The underwriter is offering the shares of
common stock subject to its acceptance of the shares of common stock from us and subject to prior sale. The underwriter reserves
the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part. In addition, the underwriter
has advised us that it does not intend to confirm sales to any account over which it exercises discretionary authority.
Commission and Expenses
The underwriter is purchasing the shares of
common stock from us at $ per share (representing $ aggregate proceeds to us, before expenses). In connection with the sale
of the shares of common stock offered hereby, the underwriter may be deemed to have received compensation in the form
of underwriting discounts.
The underwriter may offer the shares of common
stock from time to time for sale in one or more transactions on the New York Stock Exchange, in the over-the-counter market,
through negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices related to prevailing
market prices or at negotiated prices, subject to receipt and acceptance by it and subject to its right to reject any order in
whole or in part. The underwriter may effect such transactions by selling shares of common stock to or through dealers, and
such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriter and/or
purchasers of shares of common stock for whom they may act as agents or to whom they may sell as principal.
We have granted to the underwriter an option,
exercisable for up to 30 days from the date of this prospectus supplement, to purchase up to an additional shares of common
stock at $ per share. To the extent the option is exercised, the underwriter will become obligated, subject
to certain conditions, to purchase all such additional shares of common stock.
We estimate that our out-of-pocket expenses
for this offering will be approximately $ .
Listing
Our common stock is listed on the New York
Stock Exchange under the trading symbol “VGR.”
No Sales of Similar Securities
In connection with this offering, we have agreed that, subject
to certain exceptions, we will not, during the period ending 60 days after the date of this prospectus supplement, (i) sell, offer
to sell, contract to sell or lend any shares of our common stock or Related Securities (as defined below); (ii) effect any short
sale, or establish or increase any “put equivalent position” (as defined in Rule 16a-1(h) under the Exchange Act) or
liquidate or decrease any “call equivalent position” (as defined in Rule 16a-1(b) under the Exchange Act) of any shares
of our common stock or Related Securities; (iii) pledge, hypothecate or grant any security interest in any shares of our common
stock or Related Securities; (iv) in any other way transfer or dispose of any shares of our common stock or Related Securities;
(v) enter into any swap, hedge or similar arrangement or agreement that transfers, in whole or in part, the economic risk of ownership
of any shares of our common stock or Related Securities, regardless of whether any such transaction is to be settled in securities,
in cash or otherwise; (vi) announce the offering of any shares of our common stock or Related Securities; (vii) submit or file
any registration statement under the Securities Act in respect of any shares of our common stock or Related Securities (other than
as contemplated by the underwriting agreement with respect to the shares of common stock offered hereby); (viii) effect a reverse
stock split, recapitalization, share consolidation, reclassification or similar transaction affecting the outstanding shares of
our common stock; or (ix) publicly announce the intention to do any of the foregoing, without the prior written consent of the
underwriter.
For purposes hereof, “Related Securities” means
any options or warrants or other rights to acquire shares of our common stock or any securities exchangeable or exercisable for
or convertible into shares of our common stock, or to acquire other securities or rights ultimately exchangeable or exercisable
for, or convertible into, shares of our common stock.
Each of our directors and executive officers has agreed pursuant
to lock-up agreements that, subject to certain exceptions, including the transfer by Bennett S. LeBow, our Chairman, of up to
500,000 shares of our common stock, they will not, directly or indirectly, during the period that is 60 days after the date of
this prospectus supplement, without the prior written consent of the underwriter, (i) sell, offer to sell or contract to sell,
grant any option to sell (including without limitation any short sale) or establish a “put equivalent position” (as
defined in Rule 16a-1(h) under the Exchange Act), pledge, assign, or in any other way transfer or dispose of any shares of our
common stock or Related Securities currently or hereafter owned either of record or beneficially (as defined in Rule 13d-3 under
the Exchange Act) by the undersigned or any “immediate family member” (as defined in Rule 16a-1(e) under the Exchange
Act); (ii) enter into any swap, hedge or similar arrangement or agreement that transfers, in whole or in part, the economic risk
of ownership of shares of our common stock or Related Securities, regardless of whether any such transaction is to be settled
in securities, in cash or otherwise; (iii) make any demand for, or exercise any right with respect to, the registration under
the Securities Act of the offer and sale of any shares of our common stock or Related Securities, or cause to be filed a registration
statement, prospectus or prospectus supplement (or an amendment or supplement thereto) with respect to any such registration,
or; or (iv) publicly announce an intention to do any of the foregoing.
Stabilization
The underwriter has advised us that, pursuant
to Regulation M under the Securities Exchange Act of 1934, as amended, certain persons participating in the offering may engage
in short sale transactions, stabilizing transactions, syndicate covering transactions or the imposition of penalty bids in connection
with this offering. These activities may have the effect of stabilizing or maintaining the market price of the common stock at
a level above that which might otherwise prevail in the open market. Establishing short sales positions may involve either “covered”
short sales or “naked” short sales.
“Covered” short sales are sales
made in an amount not greater than the underwriters’ option to purchase additional shares of our common stock in this offering.
The underwriters may close out any covered short position by either exercising their option to purchase additional shares of our
common stock or purchasing shares of our common stock in the open market. In determining the source of shares to close out the
covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open
market as compared to the price at which they may purchase shares through the option to purchase additional shares.
“Naked” short sales are sales
in excess of the option to purchase additional shares of our common stock. The underwriters must close out any naked short position
by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned
that there may be downward pressure on the price of the shares of our common stock in the open market after pricing that could
adversely affect investors who purchase in this offering.
A stabilizing bid is a bid for the purchase
of shares of common stock on behalf of the underwriter for the purpose of fixing or maintaining the price of the common stock.
A syndicate covering transaction is the bid for or the purchase of shares of common stock on behalf of the underwriters to reduce
a short position incurred by the underwriters in connection with the offering. Similar to other purchase transactions, the underwriter’s
purchases to cover the syndicate short sales may have the effect of raising or maintaining the market price of our common stock
or preventing or retarding a decline in the market price of our common stock. As a result, the price of our common stock may be
higher than the price that might otherwise exist in the open market. A penalty bid is an arrangement permitting the underwriters
to reclaim the selling concession otherwise accruing to a syndicate member in connection with the offering if the common stock
originally sold by such syndicate member are purchased in a syndicate covering transaction and therefore have not been effectively
placed by such syndicate member.
Neither we nor the underwriter makes any representation
or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of our
common stock. The underwriter is not obligated to engage in these activities and, if commenced, any of the activities may be discontinued
at any time.
Electronic Distribution
A prospectus in electronic format may be made
available by e-mail or on the web sites or through online services maintained by one or more of the underwriters or their affiliates.
In those cases, prospective investors may view offering terms online and may be allowed to place orders online. The underwriters
may agree with us to allocate a specific number of shares of common stock for sale to online brokerage account holders. Any such
allocation for online distributions will be made by the underwriters on the same basis as other allocations. Other than the prospectus
in electronic format, the information on the underwriters’ web sites and any information contained in any other web site
maintained by any of the underwriters is not part of this prospectus, has not been approved and/or endorsed by us or the underwriters
and should not be relied upon by investors.
Other Activities and Relationships
The underwriter and certain of its affiliates
are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment
banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage
activities. The underwriter and certain of its affiliates have, from time to time, performed, and may in the future perform, various
commercial and investment banking and financial advisory services for us and our affiliates, for which they received or will receive
customary fees and expenses.
In the ordinary course of their various business
activities, the underwriter and certain of its affiliates may make or hold a broad array of investments and actively trade debt
and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account
and for the accounts of their customers, and such investment and securities activities may involve securities and/or instruments
issued by us and our affiliates. If the underwriters or their respective affiliates have a lending relationship with us, they routinely
hedge their credit exposure to us consistent with their customary risk management policies. The underwriters and their respective
affiliates may hedge such exposure by entering into transactions which consist of either the purchase of credit default swaps or
the creation of short positions in our securities or the securities of our affiliates, including potentially the common stock offered
hereby. Any such short positions could adversely affect future trading prices of the common stock offered hereby. The underwriters
and certain of their respective affiliates may also communicate independent investment recommendations, market color or trading
ideas and/or publish or express independent research views in respect of such securities or instruments and may at any time hold,
or recommend to clients that they acquire, long and/or short positions in such securities and instruments.
Disclaimers About Non-U.S. Jurisdictions
European Economic Area and United Kingdom
In relation to each Member State of the European
Economic Area and the United Kingdom (each a “Relevant State”), no Shares have been offered or will be offered pursuant
to the offering to the public in that Relevant State prior to the publication of a prospectus in relation to the Shares which has
been approved by the competent authority in that Relevant State or, where appropriate, approved in another Relevant State and notified
to the competent authority in that Relevant State, all in accordance with the Prospectus Regulation), except that offers of Shares
may be made to the public in that Relevant State at any time under the following exemptions under the Prospectus Regulation:
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to any legal entity which is a qualified investor as defined under the Prospectus Regulation;
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to fewer than 150 natural or legal persons (other than qualified investors as defined under the Prospectus Regulation), subject
to obtaining the prior consent of the underwriter for any such offer; or
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in any other circumstances falling within Article 1(4) of the Prospectus Regulation,
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provided that no such offer of Shares shall
require the Issuer or any Manager to publish a prospectus pursuant to Article 3 of the Prospectus Regulation or supplement a prospectus
pursuant to Article 23 of the Prospectus Regulation.
For the purposes of this provision, the expression
an “offer to the public” in relation to any Shares in any Relevant State means the communication in any form and by
any means of sufficient information on the terms of the offer and any Shares to be offered so as to enable an investor to decide
to purchase or subscribe for any Shares, and the expression “Prospectus Regulation” means Regulation (EU) 2017/1129.
United Kingdom
The underwriter has represented and agreed that: (a) it has
only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement
to engage in investment activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue or
sale of the shares in circumstances in which Section 21(1) of the FSMA does not apply to the Company; and (b) it has complied and
will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the shares in, from or
otherwise involving the United Kingdom.
Canada
Resale Restrictions
The distribution of common stock in Canada
is being made only in the provinces of Ontario, Quebec, Alberta and British Columbia on a private placement basis exempt from the
requirement that we prepare and file a prospectus with the securities regulatory authorities in each province where trades of these
securities are made. Any resale of the common stock in Canada must be made under applicable securities laws which may vary depending
on the relevant jurisdiction, and which may require resales to be made under available statutory exemptions or under a discretionary
exemption granted by the applicable Canadian securities regulatory authority. Purchasers are advised to seek legal advice prior
to any resale of the securities..
Representations of Canadian Purchasers
By purchasing common stock in Canada and accepting
delivery of a purchase confirmation, a purchaser is representing to us and the dealer from whom the purchase confirmation is received
that:
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the purchaser is entitled under applicable provincial securities laws to purchase the common stock without the benefit of a prospectus qualified under those securities laws as it is an “accredited investor” as defined under National Instrument 45-106 – Prospectus Exemptions,
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the purchaser is a “permitted client” as defined in National Instrument 31-103—Registration Requirements, Exemptions and Ongoing Registrant Obligations,
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where required by law, the purchaser is purchasing as principal and not as agent, and
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the purchaser has reviewed the text above under Resale Restrictions.
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Conflicts of Interest
Canadian purchasers are hereby notified that
Jefferies LLC is relying on the exemption set out in section 3A.3 or 3A.4, if applicable, of National Instrument 33-105 –
Underwriting Conflicts from having to provide certain conflict of interest disclosure in this document.
Statutory Rights of Action
Securities legislation in certain provinces
or territories of Canada may provide a purchaser with remedies for rescission or damages if the prospectus (including any amendment
thereto) such as this document contains a misrepresentation, provided that the remedies for rescission or damages are exercised
by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory.
The purchaser of these securities in Canada should refer to any applicable provisions of the securities legislation of the purchaser’s
province or territory for particulars of these rights or consult with a legal advisor.
Enforcement of Legal Rights
All of our directors and officers as well
as the experts named herein may be located outside of Canada and, as a result, it may not be possible for Canadian purchasers to
effect service of process within Canada upon us or those persons. All or a substantial portion of our assets and the assets of
those persons may be located outside of Canada and, as a result, it may not be possible to satisfy a judgment against us or those
persons in Canada or to enforce a judgment obtained in Canadian courts against us or those persons outside of Canada.
Taxation and Eligibility for Investment
Canadian purchasers of common stock should
consult their own legal and tax advisors with respect to the tax consequences of an investment in the common stock in their particular
circumstances and about the eligibility of the common stock for investment by the purchaser under relevant Canadian legislation.
VALIDITY OF SHARES
The validity of our common stock offered hereby
will be passed upon for us by Sullivan & Cromwell LLP, New York, New York. Certain legal matters in connection with this offering
will be passed upon for the underwriter by Latham & Watkins LLP, New York, New York.
EXPERTS
The financial statements, and the related
financial statement schedule, incorporated in this prospectus by reference from the Company's Annual Report on Form 10-K for the
year ended December 31, 2019, and the effectiveness of the Company’s internal control over financial reporting have been
audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports (which express
an unqualified opinion and includes explanatory paragraphs regarding the Company’s adoption of Accounting Standards Codification
Topic 606, Revenue from Contracts with Customers and Accounting Standards Update 2016-02, Leases), which are incorporated
herein by reference. Such financial statements and financial statement schedule have been so incorporated in reliance upon the
reports of such firm given upon their authority as experts in accounting and auditing.
PROSPECTUS
Common Stock
Preferred Stock
Depositary Shares
Debt Securities
Guarantees of Debt
Securities
Warrants
Rights
Purchase Contracts
Units
From
time to time, we or certain selling securityholders may offer the securities described in this prospectus separately or together
in any combination, in one or more classes or series, in amounts, at prices and on terms that we will determine at the time of
the offering.
We
will provide the specific terms of the securities to be offered in one or more supplements to this prospectus. The specific plan
of distribution for any securities to be offered will also be provided in a prospectus supplement. Prospectus supplements may also
add, update or change information in this prospectus. You should read this prospectus and the applicable prospectus supplement,
together with additional information described under “Where You Can Find More Information,” carefully before you invest
in our securities. This prospectus may not be used to offer and sell our securities unless accompanied by a prospectus supplement
describing the method and terms of the offering of those offered securities.
We
may offer and sell the securities directly, through agents we select from time to time or to or through underwriters or dealers
we select, or through a combination of these methods. In addition, certain selling securityholders may offer and sell our securities
from time to time. We will provide specific information about any selling securityholders in one or more supplements to this prospectus.
If we or the selling securityholders use any agents, underwriters or dealers to sell the securities, we will name them and describe
their compensation in a prospectus supplement. The price to the public of those securities and the net proceeds we or any selling
securityholders expect to receive from that sale will also be set forth in a prospectus supplement.
Our
common stock is listed on the New York Stock Exchange, or NYSE, under the symbol “VGR.” Each prospectus supplement
will indicate if the securities offered thereby will be listed on any securities exchange.
Investing
in any of our securities involves a high degree of risk. Please read carefully the section entitled “Risk Factors”
on page 4 of this prospectus, the “Risk Factors” section contained in the applicable prospectus supplement and the
information included and incorporated by reference in this prospectus.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined
if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus
is April 19, 2019
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the Securities and Exchange Commission (the “SEC”),
using a “shelf” registration process.
As
permitted under the rules of the SEC, this prospectus incorporates important business information about Vector Group Ltd. that
is contained in documents that we file with the SEC, but that is not included in or delivered with this prospectus. You may obtain
copies of these documents, without charge, from the web site maintained by the SEC at www.sec.gov, as well as other sources. See
“Where You Can Find More Information.” Before purchasing any securities, you should carefully read both this prospectus
and any prospectus supplement, together with the additional information described under the headings “Where You Can Find
More Information” and “Information We Incorporate by Reference.” Neither we, any selling securityholders, nor
any underwriters have authorized any other person to provide you with information other than the information contained or incorporated
by reference in this prospectus, any prospectus supplement and any free writing prospectus prepared by or on behalf of us or to
which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information
that others may give you. You should assume that the information contained in this prospectus, any prospectus supplement or any
free writing prospectus is accurate as of the date on its respective cover, and that any information incorporated by reference
is accurate only as of the date of the document incorporated by reference, unless we indicate otherwise. Our business, financial
condition, results of operations and prospects may have changed since those dates. We are not making offers to sell the securities
described in this prospectus in any jurisdiction in which an offer or solicitation is not authorized or in which the person making
such offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make an offer or solicitation.
References
in this prospectus to the terms “we,” “us,” “our,” “the Company” or other similar
terms mean Vector Group Ltd. and its consolidated subsidiaries and “Vector” means Vector Group Ltd., unless we state
otherwise or the context indicates otherwise.
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed our registration statement on Form S-3 with the SEC under the Securities Act. We also file annual, quarterly and current
reports, proxy statements and other information with the SEC. Our SEC filings, including the registration statement and the exhibits
to the registration statement are available to the public at the SEC’s web site at www.sec.gov. These documents may also
be accessed on our web site at www.vectorgroupltd.com. Information contained on our web site is not incorporated by reference into
this prospectus and you should not consider information contained on our web site to be part of this prospectus.
This
prospectus and any prospectus supplement are part of a registration statement filed with the SEC and do not contain all of the
information in the registration statement. The full registration statement may be obtained from the SEC or us as indicated above.
Forms of any indenture or other documents establishing the terms of the offered securities are filed as exhibits to the registration
statement or will be filed through an amendment to our registration statement on Form S-3 or under cover of a Current Report on
Form 8-K and incorporated in this prospectus by reference. Statements in this prospectus or any prospectus supplement about these
documents are summaries and each statement is qualified in all respects by reference to the document to which it refers. You should
refer to the actual documents for a more complete description of the relevant matters.
INFORMATION
WE INCORPORATE BY REFERENCE
The
SEC allows us to “incorporate by reference” in this prospectus the information we file with it, which means that we
can disclose important information to you by referring you to those documents. The information incorporated by reference is considered
to be part of this prospectus, and later information filed with the SEC will automatically update and supersede the information
included or incorporated by reference in this prospectus. We incorporate by reference in this prospectus the following information
(other than, in each case, documents or information deemed to have been furnished and not filed in accordance with SEC rules):
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our definitive Proxy Statement on Schedule 14A for the 2019 Annual Meeting of Shareholders, filed March 18, 2018 (solely to the extent incorporated by reference into Part III of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018).
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We
also incorporate by reference each of the documents that we file with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), on or after the date of this prospectus and prior to the termination
of the offerings under this prospectus and any prospectus supplement. We will not, however, incorporate by reference in this prospectus
any documents or portions thereof that are not deemed “filed” with the SEC, including any information furnished pursuant
to Item 2.02 or Item 7.01 of our Current Reports on Form 8-K after the date of this prospectus unless, and except to the extent,
specified in such Current Reports.
We
will provide to each person, including any beneficial owner, to whom a prospectus is delivered, a copy of any of these filings
(other than an exhibit to these filings, unless the exhibit is specifically incorporated by reference into the filing requested)
at no cost, upon a request to us by writing or telephoning us at the following address and telephone number:
Vector Group Ltd.
4400 Biscayne Boulevard
Miami, Florida 33137
Telephone Number:
(305) 579-8000
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus, including the documents incorporated by reference, contains “forward-looking statements” within the meaning
of the federal securities law. Forward-looking statements include information relating to our intent, belief or current expectations,
primarily with respect to, but not limited to:
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legislation and regulations;
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related industry developments (including trends affecting our business, financial condition and results of operations).
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We
identify forward-looking statements by terminology such as “anticipate”, “believe”, “estimate”,
“expect”, “intend”, “may be”, “objective”, “plan”, “seek”,
“predict”, “project” and “will be” and similar words or phrases or their negatives. The forward-looking
information involves important risks and uncertainties that could cause our actual results, performance or achievements to differ
materially from our anticipated results, performance or achievements expressed or implied by the forward-looking statements. Factors
that could cause actual results to differ materially from those suggested by the forward-looking statements include, without limitation,
the following:
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general economic and market conditions and any changes therein, due to acts of war and terrorism or otherwise;
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governmental regulations and policies;
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the impact of the Tax Cuts and Jobs Act of 2017, including the deductibility of interest expense and the impact on the markets of our Real Estate segment;
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effects of industry competition;
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impact of business combinations, including acquisitions and divestitures, both internally for us and externally in the tobacco industry;
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impact of legislation providing for regulation of tobacco products by the Food and Drug Administration (the “FDA”);
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impact of substantial increases in federal, state and local excise taxes;
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uncertainty related to product liability litigation including the Engle progeny cases pending in Florida and other individual and class action cases where plaintiffs have alleged compensatory and punitive damage amounts ranging into the hundreds of million and even billions of dollars; and
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potential additional payment obligations for us under the Master Settlement Agreement (the “MSA”) and other settlement agreements relating to tobacco-related litigation with the states.
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Any
forward-looking statement you read in this prospectus reflects our current views with respect to future events and is subject to
these and other risks, uncertainties and assumptions relating to our operations, operating results, growth strategy and liquidity.
We urge you to carefully review the disclosures we make concerning risks and other factors that may affect our business and operating
results, including those made under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year
ended December 31, 2018, as such risk factors may be amended, supplemented or superseded from time to time by other reports we
file with the SEC in the future, including subsequent Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K, and in any
prospectus supplement. We caution you that any forward-looking statements made in this prospectus, any prospectus supplement and
the documents incorporated herein and therein by reference are not guarantees of future performance and you should not place undue
reliance on these forward-looking statements, which speak only as of the date of this prospectus, any prospectus supplement or
any other document incorporated by reference into this prospectus or any prospectus supplement. We do not intend, and we undertake
no obligation, to update any forward-looking information to reflect events or circumstances after the date of this prospectus or
any prospectus supplement or to reflect the occurrence of unanticipated events, unless required by law to do so.
RISK
FACTORS
Investing
in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider any risk
factors set forth in the applicable prospectus supplement and the documents incorporated by reference in this prospectus, including
the factors discussed under the heading “Risk Factors” in our most recent Annual Report on Form 10-K, which may be
amended, supplemented or superseded from time to time by other reports we file with the SEC in the future. See “Where You
Can Find More Information.” The risks and uncertainties we have described are not the only risks we face. Additional risks
and uncertainties not presently known to us or that we currently deem immaterial may also affect our operations. If any of these
risks actually occurs, our business, results of operations and financial condition could suffer. In that case, the trading price
of our securities could decline, and you could lose part of your investment.
OUR
BUSINESS
Vector
Group Ltd., a Delaware corporation, is a holding company and is principally engaged in two business segments:
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Tobacco: the manufacture and sale of cigarettes in the United States through our Liggett Group LLC (“Liggett”) and Vector Tobacco Inc. (“Vector Tobacco”) subsidiaries, and
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Real Estate: the real estate business through our New Valley LLC (“New Valley”) subsidiary, which is seeking to acquire or invest in additional real estate properties or projects. New Valley owns Douglas Elliman Realty, LLC (“Douglas Elliman”), which operates the largest residential brokerage company in the New York metropolitan area and also conducts residential real estate brokerage operations in South Florida, Southern California, Connecticut, Massachusetts and Aspen, Colorado.
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Our
business segments were Tobacco and Real Estate for the years ended December 31, 2018. The Tobacco segment consists of the manufacture
and sale of cigarettes. The Real Estate segment includes our investment Douglas Elliman as well as investments in real estate and
real estate ventures.
For
the year ended December 31, 2018, Liggett was the fourth-largest manufacturer of cigarettes in the United States in terms of unit
sales. Our tobacco subsidiaries manufacture and sell cigarettes in the United States and all of our tobacco operation’s unit
sales volume in 2018 was in the discount segment. The United States cigarette market consists of premium cigarettes, which are
generally marketed under well-recognized brand names at higher retail prices to adult smokers with a strong preference for branded
products, and discount cigarettes, which are marketed at lower retail prices to adult smokers who are more value conscious. In
recent years, the discounting of premium cigarettes has become far more significant in the marketplace.
Liggett
produces cigarettes in 109 combinations of length, style and packaging. Liggett’s current brand portfolio includes PYRAMID,
EAGLE 20's, GRAND PRIX, LIGGETT SELECT and EVE and various partner brands and private label brands. Liggett’s
manufacturing facilities are located in Mebane, North Carolina where it manufactures most of Vector Tobacco’s cigarettes
pursuant to a contract manufacturing agreement. Liggett’s products are distributed from a central distribution center in
Mebane, North Carolina to 15 public warehouses located throughout the United States by third-party trucking companies. These warehouses
serve as local distribution centers for Liggett’s customers. Liggett’s customers are primarily wholesalers and distributors
of tobacco and convenience products as well as large grocery, drug and convenience store chains.
In
addition to New Valley’s investment in Douglas Elliman, New Valley holds investment interests in various real estate projects
in the United States and abroad through both debt and equity investments.
At
December 31, 2018, we had 1,555 employees, of which approximately 1,045 were employed by Douglas Elliman primarily in the New York
area, 275 were employed at Liggett’s Mebane facility and approximately 210 were employed in sales and administrative functions
at Liggett Vector Brands LLC (“LVB”), which coordinates our tobacco subsidiary’s sales and marketing efforts,
along with certain support functions.
Our
principal executive offices are located at 4400 Biscayne Boulevard, Miami, Florida 33137, our telephone number is (305) 579-8000
and our web site is http://www.vectorgroupltd.com. You should not consider information contained on our web site or that can be
accessed through our web site to be part of this prospectus.
USE
OF PROCEEDS
Unless
otherwise specified in any prospectus supplement, we intend to use the net proceeds from the sale of our securities offered under
this prospectus for working capital and general corporate purposes including, but not limited to, capital expenditures, working
capital, acquisitions and other business opportunities. Pending any specific application, we may initially invest funds in short-term
marketable securities or apply them to the reduction of short-term indebtedness.
We
will not receive any of the proceeds from sales of securities by selling securityholders, if any, pursuant to this prospectus.
DESCRIPTION
OF CAPITAL STOCK
General
The
following is a summary of the rights of our capital stock, certain provisions of our amended and restated certificate of incorporation,
as amended (our “certificate of incorporation”), and our amended and restated bylaws (our “bylaws”), and
certain provisions of applicable law. For more detailed information, please see our certificate of incorporation and our bylaws,
which are filed as exhibits to the registration statement of which this prospectus is a part.
Authorized Capitalization
Our
authorized capital stock consists of:
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250,000,000 shares of common stock, with a par value of $0.10 per share; and
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10,000,000 shares of preferred stock, with a par value of $1.00 per share.
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As
of December 31, 2018, 140,914,642 shares of our common stock were issued and outstanding, and no shares of our preferred stock
were issued and outstanding. As of December 31, 2018, we also had outstanding options granted to employees to purchase approximately
5,581,746 shares of our common stock, with a weighted-average exercise price of $13.82 per share, of which options for 3,828,073
were exercisable at December 31, 2018. We also have outstanding convertible notes and debentures maturing in April 2020, which
were convertible into 10,900,972 shares of our common stock as of January 2019.
Common Stock
Each
outstanding share of common stock is entitled to one vote on all matters submitted to a vote of stockholders. Subject to preferences
that may be applicable to any outstanding shares of preferred stock, holders of our common stock are entitled to receive ratably
such dividends as may be declared from time to time by our board of directors out of legally available assets, payable in cash,
in property or in shares of our common stock. In the event of our liquidation, dissolution or winding up, holders of common stock
are entitled to share ratably in all assets remaining after payment of all debts and other liabilities and any amounts due to the
holders of preferred stock. Holders of our common stock have no preemptive or conversion rights. No redemption or sinking fund
provisions apply to our common stock. All of our outstanding shares of common stock are fully paid and non-assessable.
Preferred Stock
Our
certificate of incorporation authorizes our board of directors, without stockholder approval, to designate and issue up to 10,000,000
shares of preferred stock in one or more series and to fix the rights and preferences, granted to or imposed upon each such series
of preferred stock, including voting rights, dividend rights, conversion rights, terms of redemption, liquidation preference, sinking
fund terms, rights and the number of shares constituting any series or the designation of a series. Except as otherwise fixed by
our board of directors in any resolution providing for the issuance of any series of preferred stock or as required by law, the
holders of shares of preferred stock shall not be entitled to vote on matters submitted to a vote of stockholders; provided, however,
that if any shares of preferred stock are outstanding, we shall not, without the consent of the holders of record of two-thirds
of the aggregate number of shares of preferred stock then outstanding, voting as a class, (i) increase the total number of authorized
shares of preferred stock, (ii) create or issue any shares of any class of capital stock ranking, either as to payment of dividends
or distribution of assets upon dissolution, liquidation or winding-up, prior to or on a parity with the preferred stock, or (iii)
alter or change the designation or the powers, preferences or rights of the preferred stock as a class, or the qualifications,
limitations or restrictions thereof.
Our
board of directors can issue, without stockholder approval, preferred stock with voting and conversion rights that could adversely
affect the voting power of the holders of common stock and reduce the likelihood that such holders will receive dividend payments
or payments upon liquidation. Such issuance could have the effect of decreasing the market price of the common stock. The issuance
of preferred stock or even the ability to issue preferred stock could also have the effect of delaying, deterring or preventing
a change of control or other corporate action.
As
of December 31, 2018, no shares of preferred stock were issued and outstanding. All shares of preferred stock offered hereby
will, when issued, be fully paid and non-assessable and, unless otherwise stated in a prospectus supplement relating to the series
of preferred stock being offered, will not have any preemptive or similar rights. We will set forth in a prospectus supplement
relating to the class or series of preferred stock being offered the specific terms of each series of our preferred stock, including
the price at which the preferred stock may be purchased, the number of shares of preferred stock offered, and the terms, if any,
on which the preferred stock may be convertible into common stock or exchangeable for other securities.
Anti-Takeover
Effects of Delaware Law and Our Certificate of Incorporation and Bylaw Provisions
Our
certificate of incorporation and bylaws contain certain provisions that may make it more difficult to acquire us by means of a
tender offer, open market purchase, proxy fight or otherwise. These provisions and certain provisions of Delaware law are expected
to discourage coercive takeover practices and inadequate takeover bids.
These
provisions are intended to enhance the likelihood of continued stability in the composition of our board of directors and its policies
and to discourage certain types of transactions that may involve an actual or threatened acquisition of us. The provisions also
are intended to discourage certain tactics that may be used in proxy fights. However, such provisions could have the effect of
discouraging others from making tender offers for our shares and, as a consequence, could deprive stockholders of opportunities
to realize takeover premiums for their shares.
Set
forth below is a summary of the relevant provisions of our certificate of incorporation and bylaws and certain applicable sections
of the General Corporation Law of the State of Delaware. For additional information we refer you to the provisions of our certificate
of incorporation, our bylaws and such sections of the General Corporation Law of the State of Delaware.
Delaware Anti-Takeover
Statute
We
are subject to the provisions of Section 203 of the General Corporation Law of the State of Delaware regulating corporate takeovers.
In general, Section 203, subject to certain exceptions, prohibits a publicly-held Delaware corporation from engaging in any business
combination with any interested stockholder for a period of three years following the date that such person or entity became an
interested stockholder, unless:
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prior to such date, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
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upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding specified shares; or
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at or subsequent to such date of the transaction that resulted in a person or entity becoming an interested stockholder, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.
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The
application of Section 203 may limit the ability of stockholders to approve a transaction that they may deem to be in their best
interests. In addition, Section 203 makes it more difficult for an interested stockholder to effect various business combinations
with a corporation for a three-year period, although the stockholders may, by adopting an amendment to our certificate of incorporation
or bylaws, elect not to be governed by this section, effective 12 months after adoption.
In
general, Section 203 defines “business combination” as:
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any merger or consolidation involving the corporation and the interested stockholder;
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any sale, lease, exchange, mortgage, pledge, transfer or other disposition of 10% or more of the assets of the corporation to or with the interested stockholder;
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subject to certain exceptions, any transaction which results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;
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any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or
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the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.
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In
general, Section 203 defines an “interested stockholder” as any person that is:
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the owner of 15% or more of the outstanding voting stock of the corporation;
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an affiliate or associate of the corporation and was the owner of 15% or more of the outstanding voting stock of the corporation at any time within three years immediately prior to the relevant date; or
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an affiliate or associate of the above.
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Our
certificate of incorporation and bylaws do not exclude us from the restrictions imposed under Section 203. We anticipate that
the provisions of Section 203 may encourage companies interested in acquiring us to negotiate in advance with our board of directors
because the stockholder approval requirement would be avoided if a majority of the directors then in office approve either the
business combination or the transaction that resulted in the stockholder becoming an interested stockholder.
Our Board of Directors
Our
by-laws provide that the number of directors may be fixed, from time to time, by the affirmative vote of a majority of the entire
board of directors or by action of the stockholders. The size of our board of directors is currently fixed at eight directors.
Each director is elected at our annual stockholder meeting, by a plurality vote, and holds office until his or her successor is
duly elected and qualified, unless he or she resigns, dies, becomes disqualified or is removed.
Removal of Directors;
Vacancies
Our
certificate of incorporation and bylaws provide that any director may be removed, with or without cause, at any time, by the holders
of a majority of the voting power of our issued and outstanding capital stock entitled to vote at an election of directors.
Our
bylaws provide that any vacancy in our board of directors may be filled by the vote of a majority of our directors then in office,
though less than a quorum, or by our sole remaining director or by our stockholders at the next annual meeting thereof or at a
special meeting thereof. Each director so elected shall hold office until his successor shall have been elected and qualified.
Amendment of Certificate
of Incorporation
Except
as otherwise provided by law or our certificate of incorporation, our certificate of incorporation may be amended, altered or repealed
by resolution of our board of directors and approval of our stockholders entitled to vote thereon either at a special or annual
meeting (provided that such amendment has been described or referred to in the notice of such meeting).
Amendment of Bylaws
Except
as otherwise provided by law, our certificate of incorporation or our bylaws, our bylaws may be amended, altered or repealed at
a meeting of the stockholders (provided that such amendment has been described or referred to in the notice of such meeting) or
a meeting of our board of directors, provided that any bylaw made by our board of directors may be amended or repealed by action
of our stockholders at any annual or special meeting of stockholders.
Transfer Agent
and Registrar
American
Stock Transfer & Trust Company is the transfer agent and registrar for our common stock.
Listing
Our
common stock is listed on the NYSE under the symbol “VGR.”
DESCRIPTION OF
DEPOSITARY SHARES
The
following description, together with the additional information we include in any applicable prospectus supplement, summarizes
the material terms and provisions of the depositary shares and depositary receipts that we may offer under this prospectus. While
the terms we have summarized below will generally apply to any future depositary shares or depositary receipts we may offer under
this prospectus, we will describe the particular terms of any depositary shares or depositary receipts that we may offer in more
detail in the applicable prospectus supplement.
We
will incorporate by reference into the registration statement of which this prospectus is a part the form of deposit agreement
that describes the terms of the depositary shares and depositary receipts we may offer before the issuance thereof. The following
summary is subject to, and qualified in its entirety by reference to, all provisions of the deposit agreement applicable to a particular
offering of depositary shares or depositary receipts. We urge you to read any applicable prospectus supplement related to the depositary
shares or depositary receipts that we sell under this prospectus, as well as the complete deposit agreement.
Description of
Depositary Shares
We
may offer depositary shares evidenced by depositary receipts. Each depositary share represents a fraction or a multiple of a share
of the particular series of preferred stock issued and deposited with a depositary to be designated by us. The fraction or the
multiple of a share of preferred stock which each depositary share represents will be set forth in the applicable prospectus supplement.
We
will deposit the preferred shares of any series of preferred stock represented by depositary shares according to the provisions
of a deposit agreement to be entered into between us and a bank or trust company which we will select as our preferred stock depositary.
We will name the depositary in the applicable prospectus supplement. Each holder of a depositary share will be entitled to all
the rights and preferences of the underlying preferred stock in proportion to the applicable fraction or multiple of a share of
preferred stock represented by the depositary share. These rights may include dividend, voting, redemption, conversion and liquidation
rights. The depositary will send the holders of depositary shares all reports and communications that we deliver to the depositary
and which we are required to furnish to the holders of depositary shares.
Depositary Receipts
The
depositary shares will be evidenced by depositary receipts issued pursuant to the deposit agreement. Depositary receipts will be
distributed to anyone who is buying the fractional shares of preferred stock in accordance with the terms of the applicable prospectus
supplement.
While
definitive engraved depositary receipts (certificates) are being prepared, we may instruct the depositary to issue temporary depositary
receipts, which will entitle holders to all the rights of the definitive depositary receipts and be substantially in the same form.
The depositary will prepare definitive depositary receipts without unreasonable delay, and we will pay for the exchange of your
temporary depositary receipts for definitive depositary receipts.
Withdrawal of
Preferred Stock
Unless
the related depositary shares have previously been called for redemption, a holder of depositary shares may receive the number
of whole shares of the related series of preferred stock and any money or other property represented by the holder’s depositary
receipts after surrendering the depositary receipts at the corporate trust office of the depositary, paying any taxes, charges
and fees provided for in the deposit agreement and complying with any other requirement of the deposit agreement. Partial shares
of preferred stock will not be issued. If the surrendered depositary shares exceed the number of depositary shares that represent
the number of whole shares of preferred stock the holder wishes to withdraw, then the depositary will deliver to the holder at
the same time a new depositary receipt evidencing the excess number of depositary shares. Once the holder has withdrawn the preferred
stock, the holder will not be entitled to re-deposit that preferred stock under the deposit agreement or to receive depositary
shares in exchange for such preferred stock. We do not expect that there will be any public trading market for withdrawn shares
of preferred stock.
Dividends and
Other Distributions
The
depositary will distribute to record holders of depositary shares any cash dividends or other cash distributions it receives on
preferred stock, after deducting its fees and expenses. Each holder will receive these distributions in proportion to the number
of depositary shares owned by the holder. The depositary will distribute only whole U.S. dollars and cents. The depositary will
add any fractional cents not distributed to the next sum received for distribution to record holders of depositary shares. In the
event of a non-cash distribution, the depositary will distribute property to the record holders of depositary shares, unless the
depositary determines that it
is not feasible to make such a distribution. If this occurs, the depositary may, with our approval, sell the property and distribute
the net proceeds from the sale to the holders. The amounts distributed to holders of depositary shares will be reduced by any amounts
required to be withheld by the depositary or by us on account of taxes or other governmental charges.
Redemption of
Depositary Shares
If
the series of preferred stock represented by depositary shares is subject to redemption, we will give the necessary proceeds to
the depositary. The depositary will then redeem the depositary shares using the funds they received from us for the preferred stock.
The redemption price per depositary share will be equal to the redemption price payable per share for the applicable series of
the preferred stock and any other amounts per share payable with respect to the preferred stock multiplied by the fraction or multiple
of a share of preferred stock represented by one depositary share. Whenever we redeem shares of preferred stock held by the depositary,
the depositary will redeem the depositary shares representing the shares of preferred stock on the same day, provided we have paid
in full to the depositary the redemption price of the preferred stock to be redeemed and any accrued and unpaid dividends. If fewer
than all the depositary shares of a series are to be redeemed, the depositary shares will be selected by lot or ratably or by any
other equitable methods as the depositary will decide.
After
the date fixed for redemption, the depositary shares called for redemption will no longer be considered outstanding. Therefore,
all rights of holders of the depositary shares will then cease, except that the holders will still be entitled to receive any cash
payable upon the redemption and any money or other property to which the holder was entitled at the time of redemption. To receive
this amount or other property, the holders must surrender the depositary receipts evidencing their depositary shares to the depositary.
Any funds that we deposit with the depositary for any depositary shares that the holders fail to redeem will be returned to us
after a period of one year from the date we deposit the funds.
Voting the Preferred
Stock
Upon
receipt of notice of any meeting at which the holders of preferred stock are entitled to vote, the depositary will notify holders
of depositary shares of the upcoming vote and arrange to deliver our voting materials to the holders. The record date for determining
holders of depositary shares that are entitled to vote will be the same as the record date for the preferred stock. The materials
the holders will receive will describe the matters to be voted on and explain how the holders, on a certain date, may instruct
the depositary to vote the shares of preferred stock underlying the depositary shares. For instructions to be valid, the depositary
must receive them on or before the date specified. To the extent possible, the depositary will vote the shares as instructed by
the holder. We agree to take all reasonable actions that the depositary determines are necessary to enable it to vote as a holder
has instructed. If the depositary does not receive specific instructions from the holders of any depositary shares, it will vote
all shares of that series held by it proportionately with instructions received.
Conversion or
Exchange
The
depositary, with our approval or at our instruction, will convert or exchange all depositary shares if the preferred stock underlying
the depositary shares is converted or exchanged. In order for the depositary to do so, we will need to deposit the other preferred
stock, common stock, or other securities into which the preferred stock is to be converted or for which it will be exchanged.
The
exchange or conversion rate per depositary share will be equal to:
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the exchange or conversion rate per share of preferred stock, multiplied by the fraction or multiple of a share of preferred stock represented by one depositary share;
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plus all money and any other property represented by one depositary share; and
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including all amounts per depositary share paid by us for dividends that have accrued on the preferred stock on the exchange or conversion date and that have not been paid.
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depositary shares, as such, cannot be converted or exchanged into other preferred stock, common stock, securities of another issuer
or any other of our securities or property. Nevertheless, if so specified in the applicable prospectus supplement, a holder of
depositary shares may be able to surrender the depositary receipts to the depositary with written instructions asking the depositary
to instruct us to convert or exchange the preferred stock represented by the depositary shares into other shares of our preferred
stock or common stock or to exchange the preferred stock for any other securities registered pursuant to the registration statement
of which this prospectus forms a part. If the depositary shares carry this right, we would agree that, upon the payment of any
applicable fees, we will cause the conversion or exchange of the preferred stock using the same procedures as we use for the delivery
of preferred stock. If a holder is only converting part of the depositary shares represented by a depositary receipt, new depositary
receipts will be issued for any depositary shares that are not converted or exchanged.
Amendment and
Termination of the Deposit Agreement
We
may agree with the depositary to amend the deposit agreement and the form of depositary receipt without consent of the holder at
any time. However, if the amendment adds or increases fees or charges, other than any change in the fees of any depositary, registrar
or transfer agent, or prejudices an important right of holders, it will only become effective with the approval of holders of at
least a majority of the affected depositary shares then outstanding. We will make no amendment that impairs the right of any holder
of depositary shares, as described above under “-Withdrawal of Preferred Stock”, to receive shares of preferred stock
and any money or other property represented by those depositary shares, except in order to comply with mandatory provisions of
applicable law. If an amendment becomes effective, holders are deemed to agree to the amendment and to be bound by the amended
deposit agreement if they continue to hold their depositary receipts.
The
deposit agreement automatically terminates if:
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all outstanding depositary shares have been redeemed or converted or exchanged for any other securities into which they or the underlying preferred stock are convertible or exchangeable;
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each share of preferred stock has been converted into or exchanged for common stock; or
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a final distribution in respect of the preferred stock has been made to the holders of depositary receipts in connection with our liquidation, dissolution or winding-up.
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We
may also terminate the deposit agreement at any time we wish. If we do so, the depositary will give notice of termination to the
record holders not less than 30 days before the termination date. Once depositary receipts are surrendered to the depositary, it
will send to each holder the number of whole or fractional shares of the series of preferred stock underlying that holder’s
depositary receipts.
Charges of Depositary
and Expenses
We
will pay the fees, charges and expenses of the depositary provided in the deposit agreement to be payable by us. Holders of depositary
receipts will pay any taxes and governmental charges and any charges provided in the deposit agreement to be payable by them. If
the depositary incurs fees, charges or expenses for which it is not otherwise liable at the election of a holder of a depositary
receipt or other person, that holder or other person will be liable for those fees, charges and expenses.
Limitations on
Our Obligations and Liability to Holders of Depositary Receipts
The
deposit agreement expressly limits our obligations and the obligations of the depositary. It also limits our liability and the
liability of the depositary as follows:
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we and the depositary are only liable to the holders of depositary receipts for negligence or willful misconduct;
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we and the depositary have no obligation to become involved in any legal or other proceeding related to the depositary receipts or the deposit agreement on your behalf or on behalf of any other party, unless you provide us with satisfactory indemnity; and
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we and the depositary may rely upon any written advice of counsel or accountants and on any documents we believe in good faith to be genuine and to have been signed or presented by the proper party.
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Resignation and
Removal of Depositary
The
depositary may resign at any time by notifying us of its election to do so. In addition, we may remove the depositary at any time.
Within 60 days after the delivery of a notice of resignation or removal of the depositary, we will appoint a successor depositary.
DESCRIPTION
OF DEBT SECURITIES
The
following description, together with the additional information we include in any applicable prospectus supplement, summarizes
certain general terms and provisions of the debt securities that we may offer in one or more series under this prospectus, which
may include guarantees of the debt securities by certain of our subsidiaries. When we offer to sell a particular series of debt
securities, we will describe the specific terms of the series, including whether such debt securities will be guaranteed, in a
supplement to this prospectus. We will also indicate in the supplement to what extent the general terms and provisions described
in this prospectus apply to a particular series of debt securities.
We
may issue debt securities either separately, or together with, or upon the conversion or exercise of or in exchange for, other
securities described in this prospectus. Debt securities may be our senior, senior subordinated or subordinated obligations and,
unless otherwise specified in a supplement to this prospectus, the debt securities will be our direct, unsecured obligations.
The
debt securities will be issued under an indenture between us and Wells Fargo Bank, National Association, as trustee. We have summarized
select portions of the indenture below. The summary is not complete. The form of the indenture has been filed as an exhibit to
the registration statement and you should read the indenture for provisions that may be important to you.
General
We
can issue an unlimited amount of debt securities under the indenture that may be in one or more series with the same or various
maturities, at par, at a premium, or at a discount. The terms of each series of debt securities will be established by or pursuant
to a resolution of our board of directors and set forth in an officer’s certificate or a supplemental indenture. The particular
terms of each series of debt securities will be described in a prospectus supplement relating to such series (including any pricing
supplement or term sheet), including the following terms, if applicable:
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the title and ranking of the debt securities (including the terms of any subordination provisions)
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the price or prices (expressed as a percentage of the principal amount) at which we will sell the debt securities;
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the aggregate principal amount of the debt securities being offered and any limit on the aggregate principal amount of such series of debt securities;
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whether any of our direct or indirect subsidiaries will guarantee the debt securities, including the terms of subordination, if any, of such guarantees;
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the date or dates on which the principal of the securities of the series is payable;
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the interest rate, if any, and the method for calculating the interest rate;
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the dates from which interest will accrue, the interest payment dates and the record dates for the interest payments;
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the place or places where principal of, and any interest on, the debt securities will be payable (and the method of such payment), where the securities of such series may be surrendered for registration of transfer or exchange, and where notices and demands to us in respect of the debt securities may be delivered;
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any mandatory or optional redemption terms;
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any obligation we have to redeem or purchase the debt securities pursuant to any sinking fund or analogous provisions or at the option of a holder of debt securities and the period or periods within which, the price or prices at which and the terms and conditions upon which securities of the series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;
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any dates, if any, on which and the price or prices at which we will repurchase debt securities at the option of the holders of debt securities and other detailed terms and provisions of such repurchase obligations;
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the denominations in which the debt securities will be issued;
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whether the debt securities will be issued in the form of certificated debt securities or global debt securities;
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the currency of denomination of the debt securities, which may be U.S. dollars or any foreign currency, and if such currency of denomination is a composite currency, the agency or organization, if any, responsible for overseeing such composite currency;
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the designation of the currency, currencies or currency units in which payment of the principal of, and any interest on, the debt securities will be made;
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if payments of principal of, any interest on, the debt securities will be made in one or more currencies or currency units other than that or those in which the debt securities are denominated, the manner in which the exchange rate with respect to such payments will be determined;
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the manner in which the amounts of payment of principal of, or any interest on, the debt securities will be determined, if these amounts may be determined by reference to an index based on a currency or currencies or by reference to a commodity, commodity index, stock exchange index or financial index;
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any provisions relating to any security provided for the debt securities;
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any addition to, deletion of or change in the events of default described in this prospectus or in the indenture with respect to the debt securities and any change in the acceleration provisions described in this prospectus or in the indenture with respect to the debt securities;
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any addition to, deletion of or change in the covenants described in this prospectus or in the indenture with respect to the debt securities;
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any depositaries, interest rate calculation agents, exchange rate calculation agents or other agents appointed with respect to the debt securities;
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the provisions, if any, relating to conversion or exchange of any series of debt securities, including if applicable, the conversion or exchange price and period, the securities or other property into which the debt securities will be convertible, provisions as to whether conversion or exchange will be mandatory, at the option of the holders thereof or at our option, the events requiring an adjustment of the conversion price or exchange price and provisions affecting conversion or exchange if such series of debt securities are redeemed; and
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any other terms of the series of debt securities that may supplement, modify or delete any provision of the indenture as it applies to that series, including any terms that may be required under applicable law or regulations or advisable in connection with the marketing of the debt securities.
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We
may issue debt securities that provide for an amount less than their stated principal amount to be due and payable upon maturity
or a declaration of acceleration of their maturity following an event of default pursuant to the terms of the indenture. We will
provide you with information on the federal income tax considerations and other special considerations applicable to any of these
debt securities in the applicable prospectus supplement.
If
we denominate the purchase price of any of the debt securities in a foreign currency or currencies or a foreign currency unit or
units, or if the principal of and any premium and interest on any series of debt securities is payable in a foreign currency or
currencies or a foreign currency unit or units, we will provide you with information on the restrictions, elections, general tax
considerations, specific terms and other information with respect to that issue of debt securities and such foreign currency or
currencies or foreign currency unit or units in the applicable prospectus supplement.
Transfer and Exchange
Each
debt security will be represented by either one or more global securities registered in the name of The Depository Trust Company,
or the depositary, or a nominee of the depositary (we will refer to any such debt security as a “global debt security”),
or a certificate issued in definitive registered form (we will refer to any debt security represented by a certificate as a “certificated
debt security”) as set forth in the applicable prospectus supplement. Except as set forth below, global debt securities will
not be issuable in certificated form.
Certificated
Debt Securities. You may transfer or exchange certificated debt securities at any office we maintain for this purpose in accordance
with the terms of the indenture. No service charge will be made for any transfer or exchange of certificated debt securities, but
we may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with a transfer
or exchange.
You
may effect the transfer of certificated debt securities and the right to receive the principal of, premium and interest on certificated
debt securities only by surrendering the certificate representing those certificated debt securities and either reissuance by us
or the trustee of the certificate to the new holder or the issuance by us or the trustee of a new certificate to the new holder.
Global
Debt Securities and Book-Entry System. Each global debt security will be deposited with, or on behalf of, the depositary, and
registered in the name of the depositary or a nominee of the depositary. Beneficial interests in global debt securities will not
be issuable in certificated form unless (i) the depositary has notified us that it is unwilling or unable to continue as depositary
for such global debt security or has ceased to be qualified to act as such as required by the indenture and we fail to appoint
a successor depositary within 90 days of such event, (ii) we determine, in our sole discretion, not to have such securities represented
by one or more global securities or (iii) any other circumstances shall exist, in addition to or in lieu of those described above,
as may be described in the applicable prospectus supplement. Unless and until a global debt security is exchanged for certificated
debt securities under the limited circumstances described in the previous sentence, a global debt security may not be transferred
except as a whole by the depositary to its nominee or by the nominee to the depositary, or by the depositary or its nominee to
a successor depositary or to a nominee of the successor depositary.
Covenants
We
will set forth in the applicable prospectus supplement any restrictive covenants applicable to any issue of debt securities.
No Protection
In the Event of a Change of Control
Unless
we state otherwise in the applicable prospectus supplement, the debt securities will not contain any provisions which may afford
holders of the debt securities protection in the event we have a change in control or in the event of a highly leveraged transaction
(whether or not such transaction results in a change in control) which could adversely affect holders of debt securities.
Consolidation,
Merger and Sale of Assets
Vector
may not consolidate with or merge with or into, or convey, transfer or lease all or substantially all of its assets to any person
(a “successor person”) unless:
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Vector is the surviving corporation or the successor person (if other than Vector) is a corporation organized and validly existing under the laws of any U.S. domestic jurisdiction and expressly assumes Vector's obligations on the debt securities and under the indenture; and
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immediately after giving effect to the transaction, no default or event of default shall have occurred and be continuing.
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Notwithstanding
the above, any of Vector's subsidiaries may consolidate with, merge into or transfer all or part of its properties to Vector.
Events
of Default
“Event
of Default” means with respect to any series of debt securities, any of the following:
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default in the payment of any interest upon any debt security of that series when it becomes due and payable, and continuance of such default for a period of 30 days (unless the entire amount of the payment is deposited by us with the trustee or with a paying agent prior to the expiration of the 30-day period);
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default in the payment of principal of any security of that series at its maturity;
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default in the performance or breach of any covenant by us in the indenture (other than defaults described above or defaults relating to a covenant that has been included in the indenture solely for the benefit of a series of debt securities other than that series), which default continues uncured for a period of 60 days after we receive written notice from the trustee, or we and the trustee receive written notice from the holders of not less than 25% in principal amount of the outstanding debt securities of that series as provided in the indenture;
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certain voluntary or involuntary events of bankruptcy, insolvency or reorganization of Vector; and
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any other event of default provided with respect to a series of debt securities, including any events of default relating to guarantors, if any, or subsidiaries that is described in the applicable prospectus supplement.
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No
event of default with respect to a particular series of debt securities (except as to certain events of bankruptcy, insolvency
or reorganization) necessarily constitutes an event of default with respect to any other series of debt securities. The occurrence
of certain events of default or an acceleration under the indenture may constitute an event of default under certain indebtedness
of ours or our subsidiaries outstanding from time to time.
If
an event of default with respect to any series of debt securities at the time outstanding occurs and is continuing (other than
an event of default resulting from certain events of bankruptcy, insolvency or reorganization), then the trustee or the holders
of not less than 25% in principal amount of the outstanding debt securities of that series may, by a notice in writing to us (and
to the trustee if given by the holders), declare to be due and payable immediately the principal of (or, if the debt securities
of that series are discount securities, that portion of the principal amount as may be specified in the terms of that series) and
accrued and unpaid interest, if any, on all debt securities of that series. In the case of an event of default resulting from certain
events of bankruptcy, insolvency or reorganization, the principal amount (or such specified amount) of and accrued and unpaid interest,
if any, on all outstanding debt securities will become and be immediately due and payable without any declaration or other act
on the part of the trustee or any holder of outstanding debt securities. At any time after a declaration of acceleration with respect
to debt securities of any series has been made, but before a judgment or decree for payment of the money due has been obtained
by the trustee, the holders of a majority in principal amount of the outstanding debt securities of that series, by written notice
to us and the trustee, may rescind and annul such declaration of acceleration and its consequences if all events of default, other
than the non-payment of accelerated principal and interest, if any, with respect to debt securities of that series, have been cured
or waived as provided in the indenture. We refer you to the prospectus supplement relating to any series of debt securities that
are discount securities for the particular provisions relating to acceleration of a portion of the principal amount of such discount
securities upon the occurrence of an event of default.
The
indenture provides that the trustee will be under no obligation to perform any duty or exercise any of its rights or powers under
the indenture unless the trustee receives indemnity satisfactory to it against any cost, liability or expense which might be incurred
by it in performing such duty or exercising such right of power. Subject to certain rights of the trustee, the holders of a majority
in principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the trustee or exercising any trust or power conferred on the trustee
with respect to the debt securities of that series.
No holder of any
debt security of any series will have any right to institute any proceeding, judicial or otherwise, with respect to the indenture
or for the appointment of a receiver or trustee, or for any remedy under the indenture, unless:
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that holder has previously given to the trustee written notice of a continuing event of default with respect to debt securities of that series;
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the holders of not less than 25% in principal amount of the outstanding debt securities of that series have made written request to the trustee to institute the proceedings in respect of such event of default in its own name as trustee under the indenture;
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such holder or holders have offered to the trustee indemnity or security satisfactory to the trustee against the costs, expenses and liabilities which might be incurred by the trustee in compliance with such request;
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the trustee has failed to institute any such proceeding for 60 days after its receipt of such notice, request and offer of indemnity; and
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no direction inconsistent with such written request has been given to the trustee during such 60-day period by holders of a majority in principal amount of the outstanding debt securities of that series.
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Notwithstanding
any other provision in the indenture, the holder of any debt security will have an absolute and unconditional right to receive
payment of the principal of, and any interest on, that debt security on or after the due dates expressed in that debt security
(or, in the case of redemption, on the redemption date) and to institute suit for the enforcement of any such payment and such
rights shall not be impaired without the consent of such holder.
The
indenture requires us, within 120 days after the end of our fiscal year, to furnish to the trustee a statement as to compliance
with the indenture from our principal executive officer, principal financial officer or principal accounting officer. If a default
or event of default occurs and is continuing with respect to the debt securities of any series and if it is actually known to a
responsible officer of the trustee, the trustee shall mail to each holder of the debt securities of that series notice of a default
or event of default within 60 days after it occurs or, if later, after a responsible officer of the trustee has knowledge of such
default or event of default. The indenture provides that the trustee may withhold notice to the holders of debt securities of any
series of any default or event of default (except in payment on any debt securities of that series) with respect to debt securities
of that series if the trustee determines in good faith that withholding notice is in the interest of the holders of those debt
securities.
Modification and
Waiver
We
and the trustee may modify and amend or supplement the indenture or the debt securities of one or more series without the consent
of any holder of any debt security:
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to add guarantees with respect to debt securities of a series or secure debt securities of a series;
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to surrender any of our rights or powers under the indenture;
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to add covenants or events of default for the benefit of the holders of any series of debt securities;
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to comply with the applicable procedures of the applicable depositary;
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to cure any ambiguity, defect or inconsistency;
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to comply with covenants in the indenture described above under the heading “Consolidation, Merger and Sale of Assets”;
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to provide for uncertificated securities in addition to or in place of certificated securities;
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to make any change that does not materially adversely affect the rights of any holder of debt securities;
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to provide for the issuance of and establish the form and terms and conditions of debt securities of any series as permitted by the indenture;
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to effect the appointment of a successor trustee with respect to the debt securities of any series and to add to or change any of the provisions of the indenture to provide for or facilitate administration by more than one trustee;
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to comply with requirements of the SEC in order to effect or maintain the qualification of the indenture under the Trust Indenture Act; and
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for certain other reasons set forth in any prospectus supplement.
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We
may also modify and amend the indenture with the consent of the holders of at least a majority in principal amount of the outstanding
debt securities of each series affected by the modifications or amendments. We may not make any modification or amendment without
the consent of the holders of each affected debt security then outstanding if that amendment will:
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reduce the principal amount of debt securities whose holders must consent to an amendment, supplement or waiver;
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reduce the rate of or extend the time for payment of interest (including default interest) on any debt security;
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reduce the principal of, or change the fixed maturity of, any debt security or reduce the amount of, or postpone the date fixed for, the payment of any sinking fund or analogous obligation with respect to any series of debt securities;
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reduce the principal amount of discount securities payable upon acceleration of maturity;
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waive a default in the payment of the principal of, or interest, if any, on any debt security (except a rescission of acceleration of the debt securities of any series by the holders of at least a majority in principal amount of the then outstanding debt securities of that series and a waiver of the payment default that resulted from such acceleration);
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make the principal of, or any interest on, any debt security payable in currency other than that stated in the debt security;
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make any change to certain provisions of the indenture relating to, among other things, the right of holders of debt securities to receive payment of the principal of, and any interest on, those debt securities and to institute suit for the enforcement of any such payment;
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make any change to certain provisions of the indenture relating to waivers or amendments; or
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waive a redemption payment with respect to any debt security, provided that such redemption is made at our option.
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Except
for certain specified provisions, the holders of at least a majority in principal amount of the outstanding debt securities of
any series may, on behalf of the holders of all debt securities of that series, by written notice to the trustee, waive our compliance
with provisions of the indenture or the debt securities with respect to such series. The holders of a majority in principal amount
of the outstanding debt securities of any series may, on behalf of the holders of all the debt securities of such series, waive
any past default under the indenture with respect to that series and its consequences, except a default in the payment of the principal
of, or any interest on, any debt security of that series; provided, however, that the holders of a majority in principal amount
of the outstanding debt securities of any series may rescind an acceleration and its consequences, including any related payment
default that resulted from the acceleration.
Defeasance
of Debt Securities and Certain Covenants in Certain Circumstances
Legal
Defeasance. The indenture provides that, unless otherwise provided by the terms of the applicable series of debt securities,
we may be discharged from any and all obligations in respect of the debt securities of any series (subject to certain exceptions).
We will be so discharged upon the deposit with the trustee, in trust, of money and/or U.S. government obligations or, in the case
of debt securities denominated in a single currency other than U.S. dollars, government obligations of the government that issued
or caused to be issued such currency, that, through the payment of interest and principal in accordance with their terms, will
provide money in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants or investment
bank to pay and discharge each installment of principal and interest, if any, on and any mandatory sinking fund payments in respect
of the debt securities of that series on the stated maturity of those payments in accordance with the terms of the indenture and
those debt securities.
This
discharge may occur only if, among other things, we have delivered to the trustee an opinion of counsel stating that we have received
from, or there has been published by, the United States Internal Revenue Service a ruling or, since the date of execution of the
indenture, there has been a change in the applicable United States federal income tax law, in either case to the effect that, and
based thereon such opinion shall confirm that, the holders of the debt securities of that series will not recognize income, gain
or loss for United States federal income tax purposes as a result of the deposit, defeasance and discharge and will be subject
to United States federal income tax on the same amounts and in the same manner and at the same times as would have been the case
if the deposit, defeasance and discharge had not occurred.
Defeasance
of Certain Covenants. The indenture provides that, unless otherwise provided by the terms of the applicable series of debt
securities, upon compliance with certain conditions:
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we may omit to comply with the covenant described under the heading “Consolidation, Merger and Sale of Assets” and certain other covenants set forth in the indenture, as well as any additional covenants which may be set forth in the applicable prospectus supplement; and
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any omission to comply with those covenants will not constitute a default or an event of default with respect to the debt securities of that series (“covenant defeasance”).
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The conditions include:
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depositing with the trustee money and/or U.S. government obligations or, in the case of debt securities denominated in a single currency other than U.S. dollars, government obligations of the government that issued or caused to be issued such currency, that, through the payment of interest and principal in accordance with their terms, will provide money in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants or investment bank to pay and discharge each installment of principal of, and interest, if any, on and any mandatory sinking fund payments in respect of the debt securities of that series on the stated maturity of those payments in accordance with the terms of the indenture and those debt securities; and
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delivering to the trustee an opinion of counsel to the effect that the holders of the debt securities of that series will not recognize income, gain or loss for United States federal income tax purposes as a result of the deposit and related covenant defeasance and will be subject to United States federal income tax on the same amounts and in the same manner and at the same times as would have been the case if the deposit and related covenant defeasance had not occurred.
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Governing
Law
The
indenture and the debt securities, including any claim or controversy arising out of or relating to the indenture or the securities,
will be governed by the laws of the State of New York (without regard to the conflicts of laws provisions thereof other than Sections
5-1401 and 5-1402 of the General Obligations Law).
Concerning our
Relationship with the Trustee
We
and our subsidiaries maintain ordinary banking relationships with Wells Fargo Bank, National Association. Wells Fargo Bank, National
Association also serves as trustee under certain of our other indentures.
DESCRIPTION
OF WARRANTS
General
The
following description, together with the additional information we include in any applicable prospectus supplement, summarizes
the material terms and provisions of the warrants that we may offer under this prospectus, which consist of warrants to purchase
common stock, preferred stock, depositary shares, and/or debt securities in one or more series. Warrants may be offered independently
or together with common stock, preferred stock, depositary shares, and/or debt securities offered by any prospectus supplement
and may be attached to or separate from those securities.
While
the terms we have summarized below will generally apply to any future warrants we may offer under this prospectus, we will describe
the particular terms of any warrants that we may offer in more detail in the applicable prospectus supplement. The specific terms
of any warrants may differ from the description provided below as a result of negotiations with third parties in connection with
the issuance of those warrants, as well as for other reasons. Because the terms of any warrants we offer under a prospectus supplement
may differ from the terms we describe below, you should rely solely on information in the applicable prospectus supplement if that
summary is different from the summary in this prospectus.
We
will issue the warrants under a warrant agreement, which we will enter into with a warrant agent to be selected by us. We use the
term “warrant agreement” to refer to any of these warrant agreements. We use the term “warrant agent” to
refer to the warrant agent under any of these warrant agreements. The warrant agent will act solely as an agent of ours in connection
with the warrants and will not act as an agent for the holders or beneficial owners of the warrants.
We
will incorporate by reference into the registration statement of which this prospectus is a part the form of warrant agreement,
including a form of warrant certificate, that describes the terms of the series of warrants we are offering before the issuance
of the related series of warrants. The following summaries of material provisions of the warrants and the warrant agreements are
subject to, and qualified in their entirety by reference to, all the provisions of the warrant agreement applicable to a particular
series of warrants. We urge you to read any applicable prospectus supplement related to the warrants that we sell under this prospectus,
as well as the complete warrant agreement that contain the terms of the warrants and defines your rights as a warrant holder.
We
will describe in the applicable prospectus supplement the terms relating to a series of warrants. If warrants for the purchase
of debt securities are offered, the prospectus supplement will describe the following terms, to the extent applicable:
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the offering price and the aggregate number of warrants offered;
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the currencies in which the warrants are being offered;
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the designation, aggregate principal amount, currencies, denominations and terms of the series of debt securities
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that can be purchased if a holder exercises a warrant;
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the designation and terms of any series of debt securities with which the warrants are being offered, including
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whether such debt securities are guaranteed, and the number of warrants offered with each such debt security;
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the date on and after which the holder of the warrants can transfer them separately from the related series of
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debt securities;
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the terms of any rights to redeem or call the warrants;
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the date on which the right to exercise the warrants begins and the date on which that right expires;
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federal income tax consequences of holding or exercising the warrants; and
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any other specific terms, preferences, rights or limitations of, or restrictions on, the warrants.
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Warrants
for the purchase of debt securities will be in registered form only.
If
warrants for the purchase of common stock, preferred stock, or depositary shares are offered, the prospectus supplement will describe
the following terms, to the extent applicable:
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the offering price and the aggregate number of warrants offered;
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the total number of shares that can be purchased if a holder of the warrants exercises them;
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the number of warrants being offered with each share of common stock;
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the date on and after which the holder of the warrants can transfer them separately from the related shares of common stock or preferred stock or the related depositary shares;
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the amount of common stock, preferred stock, or depositary shares that can be purchased if a holder exercises the warrant and the price at which those shares may be purchased upon exercise, including, if applicable, any provisions for changes to or adjustments in the exercise price and in the securities or other property receivable upon exercise;
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the terms of any rights to redeem or call, or accelerate the expiration of, the warrants;
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the date on which the right to exercise the warrants begins and the date on which that right expires;
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federal income tax consequences of holding or exercising the warrants; and
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any other specific terms, preferences, rights or limitations of, or restrictions on, the warrants.
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Warrants
for the purchase of common stock, preferred stock, or depositary shares will be in registered form only.
A
holder of warrant certificates may exchange them for new certificates of different denominations, present them for registration
of transfer and exercise them at the corporate trust office of the warrant agent or any other office indicated in the applicable
prospectus supplement. Until any warrants to purchase debt securities are exercised, the holder of the warrants will not have any
of the rights of holders of the debt securities that can be purchased upon exercise, including any rights to receive payments of
principal, premium or interest on the underlying debt securities or to enforce covenants in the applicable indenture. Until any
warrants to purchase depositary shares or shares of common stock or preferred stock are exercised, holders of the warrants will
not have any rights of holders of the underlying depositary shares or shares of common stock or preferred stock, including any
rights to receive dividends or to exercise any voting rights, except to the extent set forth under “- Warrant Adjustments”
below.
Exercise of Warrants
Each
holder of a warrant is entitled to purchase the principal amount of debt securities or number of shares of common stock or preferred
stock or number of depositary shares, as the case may be, at the exercise price described in the applicable prospectus supplement.
After the close of business on the day when the right to exercise terminates (or a later date if we extend the time for exercise),
unexercised warrants will become void.
A
holder of warrants may exercise them by following the general procedure outlined below:
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deliver to the warrant agent the payment required by the applicable prospectus supplement to purchase the underlying security;
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properly complete and sign the reverse side of the warrant certificate representing the warrants; and
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deliver the warrant certificate representing the warrants to the warrant agent within five business days of the warrant agent receiving payment of the exercise price.
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If
you comply with the procedures described above, your warrants will be considered to have been exercised when the warrant agent
receives payment of the exercise price, subject to the transfer books for the securities issuable upon exercise of the warrant
not being closed on such date. After you have completed those procedures and subject to the foregoing, we will, as soon as practicable,
issue and deliver to you the debt securities or shares of common stock or preferred stock or depositary shares that you purchased
upon exercise. If you exercise fewer than all of the warrants represented by a warrant certificate, a new warrant certificate will
be issued to you for the unexercised amount of warrants. Holders of warrants will be required to pay any tax or governmental charge
that may be imposed in connection with transferring the underlying securities in connection with the exercise of the warrants.
Amendments and
Supplements to the Warrant Agreements
We
may amend or supplement a warrant agreement without the consent of the holders of the applicable warrants to cure ambiguities in
the warrant agreement, to cure or correct a defective provision in the warrant agreement, or to provide for other matters under
the warrant agreement that we and the warrant agent deem necessary or desirable, so long as, in each case, such amendments or supplements
do not materially adversely affect the interests of the holders of the warrants.
Warrant Adjustments
Unless
the applicable prospectus supplement states otherwise, the exercise price of, and the number of securities covered by, a warrant
for depositary shares or shares of common stock or preferred stock will be adjusted proportionately if we subdivide or combine
our common stock or preferred stock, as applicable. In addition, unless the prospectus supplement states otherwise, if we, without
payment:
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issue shares of common stock or preferred stock or other securities convertible into or exchangeable for common stock or preferred stock, or any rights to subscribe for, purchase or otherwise acquire any of the foregoing, as a dividend or distribution to all or substantially all holders of our common stock or preferred stock;
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pay any cash to all or substantially all holders of our common stock or preferred stock, other than a cash dividend paid out of our current or retained earnings;
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issue any evidence of our indebtedness or rights to subscribe for or purchase our indebtedness to all or substantially all holders of our common stock or preferred stock; or
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issue common stock, preferred stock or additional shares or other securities or property to all or substantially all holders of our common stock or preferred stock by way of spinoff, split-up, reclassification, combination of shares or similar corporate rearrangement;
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then the holders
of common stock warrants, preferred stock warrants, or depositary share warrants will be entitled to receive upon exercise of the
warrants, in addition to the securities otherwise receivable upon exercise of the warrants and without paying any additional consideration,
the amount of shares and other securities and property such holders would have been entitled to receive had they held the common
stock or preferred stock or depositary shares issuable under the warrants on the dates on which holders of those securities received
or became entitled to receive such additional shares and other securities and property.
Except
as stated above, the exercise price and number of securities covered by a warrant for shares of common stock, preferred stock,
or depositary shares, and the amounts of other securities or property to be received, if any, upon exercise of those warrants,
will not be adjusted or provided for if we issue those securities or any securities convertible into or exchangeable for those
securities, or securities carrying the right to purchase those securities or securities convertible into or exchangeable for those
securities.
Holders
of common stock warrants, preferred stock warrants or depositary share warrants may have additional rights under the following
circumstances:
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certain reclassifications, capital reorganizations or changes of the common stock or preferred stock;
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certain share exchanges, mergers, or similar transactions involving us that result in changes of the common stock or preferred stock; or
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certain sales or dispositions to another entity of all or substantially all of our property and assets.
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If
one of the above transactions occurs and holders of our common stock, preferred stock, or depositary shares are entitled to receive
shares, securities or other property with respect to or in exchange for their securities, the holders of the common stock warrants,
preferred stock warrants, or depositary share warrants then outstanding, as applicable, will be entitled to receive upon exercise
of their warrants the kind and amount of shares and other securities or property that they would have received upon the applicable
transaction if they had exercised their warrants immediately before the transaction.
DESCRIPTION
OF RIGHTS
The
following description, together with the additional information we include in any applicable prospectus supplement, summarizes
the general features of the rights that we may offer under this prospectus. We may issue rights to our stockholders to purchase
shares of our common stock and/or any of the other securities offered hereby. Each series of rights will be issued under a separate
rights agreement to be entered into between us and a bank or trust company, as rights agent. When we issue rights, we will provide
the specific terms of the rights and the applicable rights agreement in a prospectus supplement. Because the terms of any rights
we offer under a prospectus supplement may differ from the terms we describe below, you should rely solely on information in the
applicable prospectus supplement if that summary is different from the summary in this prospectus. We will incorporate by reference
into the registration statement of which this prospectus is a part the form of rights agreement that describes the terms of the
series of rights we are offering before the issuance of the related series of rights. The applicable prospectus supplement relating
to any rights will describe the terms of the offered rights, including, where applicable, the following:
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the date for determining the persons entitled to participate in the rights distribution;
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the exercise price for the rights;
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the aggregate number or amount of underlying securities purchasable upon exercise of the rights;
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the number of rights issued to each stockholder and the number of rights outstanding, if any;
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the extent to which the rights are transferable;
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the date on which the right to exercise the rights will commence and the date on which the right will expire;
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the extent to which the rights include an over-subscription privilege with respect to unsubscribed securities;
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anti-dilution provisions of the rights, if any; and
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any other terms of the rights, including terms, procedures and limitations relating to the distribution, exchange and exercise of the rights.
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Holders
may exercise rights as described in the applicable prospectus supplement. Upon receipt of payment and the rights certificate properly
completed and duly executed at the corporate trust office of the rights agent or any other office indicated in the prospectus supplement,
we will, as soon as practicable, forward the securities purchasable upon exercise of the rights. If less than all of the rights
issued in any rights offering are exercised, we may offer any unsubscribed securities directly to persons other than stockholders,
to or through agents, underwriters or dealers or through a combination of such methods, including pursuant to standby underwriting
arrangements, as described in the applicable prospectus supplement.
DESCRIPTION OF
PURCHASE CONTRACTS
The
following description summarizes the general features of the purchase contracts that we may offer under this prospectus. While
the features we have summarized below will generally apply to any future purchase contracts we may offer under this prospectus,
we will describe the particular terms of any purchase contracts that we may offer in more detail in the applicable prospectus supplement.
The specific terms of any purchase contracts may differ from the description provided below as a result of negotiations with third
parties in connection with the issuance of those purchase contracts, as well as for other reasons. Because the terms of any purchase
contracts we offer under a prospectus supplement may differ from the terms we describe below, you should rely solely on information
in the applicable prospectus supplement if that summary is different from the summary in this prospectus.
We
will incorporate by reference into the registration statement of which this prospectus is a part the form of any purchase contract
that we may offer under this prospectus before the sale of the related purchase contract. We urge you to read any applicable prospectus
supplement related to specific purchase contracts being offered, as well as the complete instruments that contain the terms of
the securities that are subject to those purchase contracts. Certain of those instruments, or forms of those instruments, have
been filed as exhibits to the registration statement of which this prospectus is a part, and supplements to those instruments or
forms may be incorporated by reference into the registration statement of which this prospectus is a part from reports we file
with the SEC.
We
may issue purchase contracts, including contracts obligating holders to purchase from us, and for us to sell to holders, a specific
or variable number of our, or an unaffiliated entity’s, securities at a future date or dates. Alternatively, the purchase
contracts may obligate us to purchase from holders, and obligate holders to sell to us, a specific or varying number of our securities.
If
we offer any purchase contracts, certain terms of that series of purchase contracts will be described in the applicable prospectus
supplement, including, without limitation, the following:
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the price of the securities or other property subject to the purchase contracts (which may be determined by reference to a specific formula described in the purchase contracts);
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whether the purchase contracts are issued separately, or as a part of units each consisting of a purchase contract and one or more of our other securities or securities of an unaffiliated entity, including U.S. Treasury securities, securing the holder’s obligations under the purchase contract;
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any requirement for us to make periodic payments to holders or vice versa, and whether the payments are unsecured or pre-funded;
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any provisions relating to any security provided for the purchase contracts;
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whether the purchase contracts obligate the holder or us to purchase or sell, or both purchase and sell, the securities subject to purchase under the purchase contract, and the nature and amount of each of those securities, or the method of determining those amounts;
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whether the purchase contracts are to be prepaid or not;
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whether the purchase contracts are to be settled by delivery, or by reference or linkage to the value, performance or level of the securities subject to purchase under the purchase contract;
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any acceleration, cancellation, termination or other provisions relating to the settlement of the purchase contracts;
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a discussion of certain united states federal income tax considerations applicable to the purchase contracts;
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whether the purchase contracts will be issued in fully registered or global form; and
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any other terms of the purchase contracts and any securities subject to such purchase contracts.
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DESCRIPTION
OF UNITS
We
may issue units comprising two or more securities described in this prospectus in any combination. For example, we might issue
units consisting of a combination of debt securities and warrants to purchase common stock. The following description sets forth
certain general terms and provisions of the units that we may offer pursuant to this prospectus. The particular terms of the units
and the extent, if any, to which the general terms and provisions may apply to the units so offered will be described in the applicable
prospectus supplement.
Each
unit will be issued so that the holder of the unit also is the holder of each security included in the unit. Thus, the unit will
have the rights and obligations of a holder of each included security. Units will be issued pursuant to the terms of a unit agreement,
which may provide that the securities included in the unit may not be held or transferred separately at any time or at any time
before a specified date. A copy of the forms of the unit agreement and the unit certificate relating to any particular issue of
units will be filed with the SEC each time we issue units, and you should read those documents for provisions that may be important
to you. For more information on how you can obtain copies of the forms of the unit agreement and the related unit certificate,
see “Where You Can Find More Information.”
The
prospectus supplement relating to any particular issuance of units will describe the terms of those units, including, to the extent
applicable, the following:
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the designation and terms of the units and the securities comprising the units, including whether and under what circumstances those securities may be held or transferred separately;
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any provision for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units; and
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whether the units will be issued in fully registered or global form.
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SELLING
SECURITYHOLDERS
If
the registration statement of which this prospectus forms a part is used by selling securityholders for the resale of any securities
registered hereunder, information about such selling securityholders, their beneficial ownership of our securities and their relationship
with us will be set forth in a prospectus supplement, in a post-effective amendment, or in filings we make with the SEC under the
Exchange Act that are incorporated by reference herein.
PLAN
OF DISTRIBUTION
We,
or selling securityholders, may sell the securities from time to time pursuant to underwritten public offerings, negotiated transactions,
block trades or a combination of these methods or through underwriters or dealers, through agents and/or directly to one or more
purchasers. The securities may be distributed from time to time in one or more transactions:
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at a fixed price or prices, which may be changed;
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at market prices prevailing at the time of sale;
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at prices related to such prevailing market prices; or
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Each
prospectus will indicate if the securities offered thereby will be listed on any securities exchange.
Offers
to purchase the securities being offered by this prospectus may be solicited directly. Agents may also be designated to solicit
offers to purchase the securities from time to time. Any agent involved in the offer or sale of our securities will be identified
in a prospectus supplement.
If
a dealer is utilized in the sale of the securities being offered by this prospectus, the securities will be sold to the dealer,
as principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time
of resale.
If
an underwriter is utilized in the sale of the securities being offered by this prospectus, an underwriting agreement will be executed
with the underwriter at the time of sale and the name of any underwriter will be provided in the prospectus supplement that the
underwriter will use to make resales of the securities to the public. In connection with the sale of the securities, we, or selling
securityholders, or the purchasers of securities for whom the underwriter may act as agent, may compensate the underwriter in the
form of underwriting discounts or commissions. The underwriter may sell the securities to or through dealers, and those dealers
may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the
purchasers for which they may act as agent. Unless otherwise indicated in a prospectus supplement, an agent will be acting on a
best efforts basis and a dealer will purchase securities as a principal, and may then resell the securities at varying prices to
be determined by the dealer.
Any
compensation paid to underwriters, dealers or agents in connection with the offering of the securities, and any discounts, concessions
or commissions allowed by underwriters to participating dealers will be provided in the applicable prospectus supplement. Underwriters,
dealers and agents participating in the distribution of the securities may be deemed to be underwriters within the meaning of the
Securities Act of 1933 (the “Securities Act”), and any discounts and commissions received by them and any profit realized
by them on resale of the securities may be deemed to be underwriting discounts and commissions. We may enter into agreements to
indemnify underwriters, dealers and agents against civil liabilities, including liabilities under the Securities Act, or to contribute
to payments they may be required to make in respect thereof and to reimburse those persons for certain expenses.
The
securities may or may not be listed on a national securities exchange. To facilitate the offering of securities, certain persons
participating in the offering may engage in transactions that stabilize, maintain or otherwise affect the price of the securities.
This may include over-allotments or short sales of the securities, which involve the sale by persons participating in the offering
of more securities than were sold to them. In these circumstances, these persons would cover such over-allotments or short positions
by making purchases in the open market or by exercising their over-allotment option, if any. In addition, these persons may stabilize
or maintain the price of the securities by bidding for or purchasing securities in the open market or by imposing penalty bids,
whereby selling concessions allowed to dealers participating in the offering may be reclaimed if securities sold by them are repurchased
in connection with stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price
of the securities at a level above that which might otherwise prevail in the open market. These transactions may be discontinued
at any time.
If
indicated in the applicable prospectus supplement, underwriters or other persons acting as agents may be authorized to solicit
offers by institutions or other suitable purchasers to purchase the securities at the public offering price set forth in the prospectus
supplement, pursuant to delayed delivery contracts providing for payment and delivery on the date or dates stated in the prospectus
supplement. These purchasers may include, among others, commercial and savings banks, insurance companies, pension funds, investment
companies and educational and charitable institutions. Delayed delivery contracts will be subject to the condition that the purchase
of the securities covered by the delayed delivery contracts will not at the time of delivery be prohibited under the laws of any
jurisdiction in the united states to which the purchaser is subject. The underwriters and agents will not have any responsibility
with respect to the validity or performance of these contracts.
We
may engage in at-the-market offerings into an existing trading market in accordance with rule 415(a)(4) under the Securities Act.
In addition, we or the selling securityholders may enter into derivative transactions with third parties, or sell securities not
covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement so indicates,
in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus
supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us,
the selling securityholders or others to settle those sales or to close out any related open borrowings of common stock, and may
use securities received from us or the selling securityholders in settlement of those derivatives to close out any related open
borrowings of our common stock. In addition, we or the selling securityholders may loan or pledge securities to a financial institution
or other third party that in turn may sell the securities using this prospectus and an applicable prospectus supplement. Such financial
institution or other third party may transfer its economic short position to investors in our securities or in connection with
a concurrent offering of other securities.
The
underwriters, dealers and agents may engage in transactions with us, or perform services for us, in the ordinary course of business
for which they receive compensation.
VALIDITY
OF SECURITIES
The
validity of the securities offered hereby will be passed upon for us by Sullivan & Cromwell LLP, New York, New York. Certain
legal matters in connection with Virginia law will be passed upon by Robert T. Vaughan, Jr., P.C.
EXPERTS
The
financial statements, and the related financial statement schedule, incorporated in this Prospectus by reference from the Company's
Annual Report on Form 10-K, and the effectiveness of Vector Group Ltd.’s internal control over financial reporting have been
audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports, which are incorporated
herein by reference. Such financial statements and financial statement schedule have been so incorporated in reliance upon the
reports of such firm given upon their authority as experts in accounting and auditing.
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