Forest City Realty Trust, Inc. (NYSE:FCE.B) Files An 8-K Entry into a Material Definitive Agreement

Forest City Realty Trust, Inc. (NYSE:FCE.B) Files An 8-K Entry into a Material Definitive Agreement

Story continues below

Item1.01 Entry into a Material Definitive Agreement.

Reclassification Agreement

On December5, 2016, Forest City Realty Trust, Inc., a Maryland
corporation (the Company), announced a plan to reclassify the
Companys stock to eliminate its dual-class stock structure (the
Reclassification). In support of the Reclassification, the
Company has entered into a Reclassification Agreement, dated
December5, 2016 (the Reclassification Agreement), with RMS,
Limited Partnership (RMS), the beneficial owner of a majority of
the issued and outstanding shares of the Companys Class B Common
Stock. The General Partners of RMS include members of the
Companys current Board of Directors and certain executive
officers of the Company.

The Reclassification Agreement provides that, at the closing,
following the satisfaction of the conditions thereto, the Company
will amend and restate its charter (the Proposed Amendments).
Upon the acceptance of the Proposed Amendments by the Maryland
State Department of Assessments and Taxation (the Effective
Time), each share of Class B Common Stock issued and outstanding
immediately prior to the Effective Time will be reclassified and
exchanged into 1.31 shares of ClassA Common Stock, with a right
to cash in lieu of fractional shares.

The closing of the Reclassification is subject to customary
conditions, including, (i)approval of the Proposed Amendments by
the affirmative vote of a majority of the issued and outstanding
shares of ClassA Common Stock and a majority of the issued and
outstanding shares of Class B Common Stock (voting as separate
classes), and that the holders of a majority of the issued and
outstanding shares of ClassA Common Stock entitled to vote
thereon, excluding shares of ClassA Common Stock beneficially
owned by RMS and Ratner Family Members (as defined in the
Reclassification Agreement), vote to approve the Proposed
Amendments (ii)the effectiveness of the Companys registration
statement on Form S-4 to be filed with the U.S. Securities and
Exchange Commission in connection with the Reclassification,
(iii)approval by the New York Stock Exchange of the listing of
the shares of ClassA Common Stock into which the Class B Common
Stock will be reclassified and exchanged into, subject to
official notice of issuance, (iv)the accuracy of the
representations and warranties of each party (subject to
specified materiality standards) and material compliance by each
party with its obligations under the Reclassification Agreement.
The Reclassification Agreement contains customary
representations, warranties and covenants of each of the parties
thereto for a transaction of this type.

Subject to specified exceptions, RMS has agreed to vote all of
RMSs shares of ClassA Common Stock and Class B Common Stock
(together, Common Stock), representing a majority of the issued
and outstanding shares of Class B Common Stock, in favor of the
Proposed Amendments. In addition, the Company and RMS have
entered into an Irrevocable Proxy, dated as of December5, 2016,
appointing the Company as RMSs proxy for purposes of voting on
the foregoing matters (the Irrevocable Proxy).

to the Reclassification Agreement, the Company will (i)include in
the slate of nominees recommended by the Board each of Brian J.
Ratner, James A. Ratner, Ronald A. Ratner and Deborah Ratner
Salzberg (each an Initial RMS Designee) to stand for election as
directors at the Companys 2017, 2018 and 2019 annual stockholders
meetings. If an Initial RMS Designee declines to stand for
election at the 2017, 2018 or 2019 annual stockholders meetings,
or fails to be elected as a director at the 2017 or 2018 annual
stockholders meetings, then the Board will nominate an individual
designated by RMS that is reasonably acceptable to the Corporate
Governance and Nominating Committee of the Board to stand for
election as director at the next succeeding annual stockholders
meeting.

to the Reclassification Agreement, after the Effective Time, so
long as the Ratner Family Members continue to beneficially own
18,153,421 shares of ClassA Common Stock (adjusted for any stock
dividend, stock split, reverse stock split or similar
transaction), the Company will also include in the slate of
nominees recommended by the Board two individuals designated by
RMS, (or, if RMS is unable to make such designation, two Ratner
Family Members as designated by the Board) that are reasonably
acceptable to the Corporate Governance and Nominating Committee
to stand for election as directors at the 2020 and 2021 annual
stockholder meetings (the two individuals so designated, the
Continuing RMS Designees). The Company expects that the two
Continuing RMS Designees will consist of two of the Initial RMS
Designees. If a Continuing RMS Designee declines to stand for
election at the 2020 or 2021 annual stockholders meeting, or
fails to be elected as a director at the 2020 annual stockholders
meeting, then the Board will nominate an individual designated by
RMS that is reasonably acceptable to the Corporate Governance and
Nominating Committee of the Board to stand for election as
director at the next succeeding annual stockholders meeting.

At the Effective Time, the Board will also amend the bylaws of
the Company to implement majority voting in uncontested director
elections.

The Reclassification Agreement also includes a covenant requiring
RMS, until the closing of the Reclassification or the termination
of the Reclassification Agreement, to continue to hold the power
to vote or direct the voting of at least a majority of the issued
and outstanding Class B Common Stock.

The Reclassification Agreement contains certain termination
rights, including the right of either party to terminate for
specified breaches of the other party, subject to a cure period,
and if the Reclassification does not occur by July31, 2017.

The foregoing descriptions of the Reclassification Agreement and
the Irrevocable Proxy do not purport to be complete and are
qualified in their entirety by reference thereto. The form of
Articles of Amendment and Restatement of the Company, form of
Amended and Restated Bylaws of the Company, Reclassification
Agreement, and Irrevocable Proxy are filed as Exhibits 3.1, 3.2,
10.1 and 10.2 to this Current Report on Form 8-K and are
incorporated herein by reference.

Voting and Support Agreement

In connection with the Reclassification Agreement, on December5,
2016, the Company entered into a Voting and Support Agreement
with Scopia Capital Management LP and Scopia Management, Inc., on
behalf of themselves and their controlled affiliates
(collectively, the Scopia Parties).

to the Voting and Support Agreement, the Scopia Parties have
agreed, among other things and subject to certain conditions, to,
at the Companys 2017 annual meeting of stockholders, vote shares
of Common Stock beneficially owned by the Scopia Parties (a)in
favor of any and all persons nominated by the Board for election
as directors (provided at least eight of the thirteen nominees
have been determined to be independent directors by the Board in
accordance with relevant stock exchange rules), (b)in favor of
approving the Proposed Amendments and any action reasonably
requested by the Company in furtherance of the foregoing, and
(c)against any other action, agreement or transaction involving
the Company or the Board that is intended, or would reasonably be
expected, to prevent or impair or delay the consummation of the
Reclassification or the other transactions contemplated by the
Reclassification Agreement.

The Voting and Support Agreement is filed as Exhibit 10.3 to this
Form 8-K and is incorporated by reference herein. The foregoing
description of various terms of the Voting and Support Agreement
is qualified in its entirety by reference to the Voting and
Support Agreement.

Item5.02 Departure of Directors or Certain Officers;
Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.

The information contained in Item1.01 above is incorporated by
reference herein in its entirety.

Bruce C. Ratner, who currently serves as a Class B Director of
the Company, will resign from the Board of the Company effective
December31, 2016. Bruce C. Ratners decision to resign did not
involve any disagreement with the Company, its management, the
Board or RMS.

Charles A. Ratner, who currently serves as Chairman of the Board
and as a Class B Director of the Company, will retire from the
Board of Directors of the Company effective December31, 2016.
Charles A. Ratners decision to retire from the Board did not
involve any disagreement with the Company, its management, the
Board or RMS. to the Reclassification Agreement, the Board will
fill the vacancy created by Chairman Ratners retirement from the
Board by electing James A. Ratner to the Board. At that time,
James A. Ratner will resign his current office of Executive Vice
President Development of the Company. From his appointment until
the 2019 annual meeting of stockholders, unless his service as a
director earlier terminates, James A. Ratner will serve as
non-executive Chairman of the Board.

Stan Ross, who currently serves as a ClassA Director of the
Company and on the Audit Committee and Compensation Committee of
the Board, will not stand for reelection to the Board at the 2017
annual meeting of stockholders. Mr.Rosss decision

to not stand for reelection did not involve any disagreement with
the Company, its management, the Board or RMS.

Item8.01 Other Events.

On December6, 2016, the Company issued a press release announcing
the matters discussed in this Current Report on Form 8-K. A copy
of the press release is attached as Exhibit 99.1 and is
incorporated herein by reference.

***

FORWARD-LOOKING STATEMENTS

This document contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements relate to future, not past,
events and often address our expected future actions and expected
future business and financial performance. Forward-looking
statements may be identified by the use of words, such as
potential, expect, intend, plan, may, subject to, continues, if
and similar words and phrases. These forward-looking statements
are not guarantees of future events and involve risks,
uncertainties and assumptions that are difficult to predict. All
statements regarding the reclassification and expected associated
costs and benefits, the likelihood of satisfaction of certain
conditions to the completion of the reclassification, whether and
when the reclassification will be completed and expected future
financial performance are forward looking. Discussions of
strategies, plans or intentions often contain forward-looking
statements. Actual results, developments and business decisions
may differ materially from those expressed or implied by such
forward-looking statements. Important factors, among others, that
could cause the Companys actual results and future actions to
differ materially from those described in forward-looking
statements include, but are not limited to: failure to receive
the requisite approval of its stockholders necessary to achieve
the reclassification, any other delays with respect to, or the
failure to complete, the reclassification, the ability to carry
out future transactions and strategic investments, as well as the
acquisition related costs, unanticipated difficulties realizing
expected benefits anticipated when entering into a transaction,
its ability to qualify or to remain qualified as a REIT, its
ability to satisfy REIT distribution requirements, the impact of
issuing equity, debt or both, and selling assets to satisfy its
future distributions required as a REIT or to fund capital
expenditures, future growth and expansion initiatives, the impact
of the amount and timing of any future distributions, the impact
from complying with REIT qualification requirements limiting its
flexibility or causing it to forego otherwise attractive
opportunities beyond rental real estate operations, the impact of
complying with the REIT requirements related to hedging, its lack
of experience operating as a REIT, legislative, administrative,
regulatory or other actions affecting REITs, including positions
taken by the Internal Revenue Service, the possibility that its
Board of Directors will unilaterally revoke its REIT election,
the possibility that the anticipated benefits of qualifying as a
REIT will not be realized, or will not be realized within the
expected time period, the impact of current lending and capital
market conditions on its liquidity, its ability to finance or
refinance projects or repay its debt, the impact of the slow
economic recovery on the

ownership, development and management of its commercial real
estate portfolio, general real estate investment and development
risks, using modular construction as a new construction
methodology, litigation risks, vacancies in its properties, risks
associated with developing and managing properties in partnership
with others, competition, its ability to renew leases or re-lease
spaces as leases expire, illiquidity of real estate investments,
bankruptcy or defaults of tenants, anchor store consolidations or
closings, the impact of terrorist acts and other armed conflicts,
its substantial debt leverage and the ability to obtain and
service debt, the impact of restrictions imposed by its revolving
credit facility, term loan facility and senior debt, exposure to
hedging agreements, the level and volatility of interest rates,
the continued availability of tax-exempt government financing,
its ability to receive payment on the notes receivable issued by
Onexim in connection with their purchase of the companys
interests in the Barclays Center and the Nets, the impact of
credit rating downgrades, effects of uninsured or underinsured
losses, effects of a downgrade or failure of its insurance
carriers, environmental liabilities, competing interest of its
directors and executive officers, the ability to recruit and
retain key personnel, risks associated with the sale of tax
credits, downturns in the housing market, the ability to maintain
effective internal controls, compliance with governmental
regulations, increased legislative and regulatory scrutiny of the
financial services industry, changes in federal, state or local
tax laws, volatility in the market price of its publicly traded
securities, inflation risks, cybersecurity risks, cyber
incidents, conflicts of interest, and risks related to its
organizational structure including operating through its
Operating Partnership and its UPREIT structure. These risks and
uncertainties, as well as others, are discussed in more detail in
our documents filed with the SEC, including our Annual Report on
Form 10-K for the year ended December31, 2015, our quarterly
reports on Form 10-Q, and our Current Reports on Form 8-K. We
expressly disclaim any obligation to update any forward-looking
statement contained in this document to reflect events or
circumstances that may arise after the date hereof, all of which
are expressly qualified by the foregoing, other than as required
by applicable law.

IMPORTANT ADDITIONAL INFORMATION

This document does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation
of any vote or approval nor shall there be any sale of securities
in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under
the securities laws of any such jurisdiction. The Company intends
to file with the U.S. Securities and Exchange Commission a
Registration Statement on Form S-4, which will contain a proxy
statement/prospectus in connection with the proposed
reclassification. Stockholders are urged to read the
proxy statement/prospectus when it becomes available because it
will contain important information.
Stockholders will be
able to obtain a free copy of the proxy statement/prospectus
(when available), as well as other filings containing information
about the Company, without charge, at the SECs website,
www.sec.gov, and on the Investor Relations page of the Companys
website at http://ir.forestcity.net/.

PARTICIPANTS IN THE SOLICITATION

The directors and executive officers of the Company and other
persons may be deemed to be participants in the solicitation of
proxies from stockholders in respect of the proposed
reclassification. Information regarding the Companys directors
and executive officers is available in the Companys most recent
proxy statement, dated April7, 2016, for the Annual Meeting of
Stockholders held on May25, 2016, which was filed with the SEC on
April7, 2016, and the Companys other filings with the SEC. Other
information regarding the participants in the proxy solicitation
and a description of their direct and indirect interests will be
contained in the proxy statement/prospectus when it becomes
available.

Item9.01.Financial Statements and Exhibits

(d)Exhibits.

ExhibitNo.

Description of Exhibit

3.1

Form of Articles of Amendment and Restatement of Forest City
Realty Trust, Inc.

3.2

Form of Amended and Restated Bylaws of Forest City Realty
Trust, Inc.

10.1

Reclassification Agreement, dated as of December5, 2016, by
and between Forest City Realty Trust, Inc. and RMS, Limited
Partnership

10.2

Irrevocable Proxy, dated as of December5, 2016, by and
between Forest City Realty Trust, Inc. and RMS, Limited
Partnership

10.3

Voting and Support Agreement, dated as of December5, 2016, by
and between Forest City Realty Trust, Inc., and Scopia
Capital Management LP and Scopia Management, Inc., on behalf
of themselves and their affiliates

99.1

Press Release issued by Forest City Realty Trust, Inc., dated
December6, 2016


About Forest City Realty Trust, Inc. (NYSE:FCE.B)

Forest City Realty Trust, Inc. is engaged in the ownership, development, management and acquisition of commercial, and residential real estate and land throughout the United States. The Company’s segments include the Commercial Group, Residential Group, Land Development Group and Corporate Activities. The Commercial Group segment owns, develops, acquires and operates regional malls, specialty/urban retail centers, office and life science buildings, and mixed-use projects. The Residential Group segment owns, develops, acquires and operates residential rental properties, including upscale and middle-market apartments, re-use developments, for-sale condominium projects and subsidized senior housing. The Land Development Group segment acquires and sells both land and developed lots to residential, commercial and industrial customers at its Stapleton project in Denver, Colorado. It conducts all of its business, through the Operating Partnership, Forest City Enterprises, L.P.

Forest City Realty Trust, Inc. (NYSE:FCE.B) Recent Trading Information

Forest City Realty Trust, Inc. (NYSE:FCE.B) closed its last trading session up +0.02 at 19.25 with 2,298 shares trading hands.

An ad to help with our costs