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SEC Filings

FOREST CITY REALTY TRUST, INC. filed this Form PREM14A on 09/21/2018
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during the last year, progress in the development pipeline and the restructuring of certain joint venture assets and other actions undertaken to mitigate risk and simplify Forest City’s business;



the view of certain directors that the grant of exclusivity to Brookfield, coupled with the initial transaction committee’s decisions to permit Brookfield to engage in discussions with Sponsor A and Sponsor C during the Exclusivity Period, may have diminished the Company’s negotiating leverage with Brookfield in subsequent price negotiations;



the fact that, pursuant to the terms of the merger agreement, the $25.35 per share in cash that a holder of common stock is entitled to receive in the merger will be reduced by the per share amount of any quarterly cash dividend that we may declare and pay after the date of the merger agreement and prior to consummation of the merger (other than any dividends declared and publicly announced on or prior to May 15, 2018) and the amount of any special REIT taxable income distribution;



the fact that if the Brookfield Parties’ debt financing is unavailable, we are not entitled to specifically enforce the merger agreement or the equity commitment letter, and that our exclusive remedy, available if the merger agreement is terminated in certain circumstances, would be limited to a reverse termination fee payable by Parent in the amount of $488 million (the payment of which is guaranteed by the Investors);



a concern among certain directors that the competitive nature of the strategic process may have been dampened by perceptions that our Board was subject to pressure from certain of our stockholders to consummate a sale transaction; and



our inability to solicit competing acquisition proposals and the possibility that a termination fee of $261 million payable by us upon the termination of the merger agreement under the circumstances described in the merger agreement could discourage other potential bidders from making a competing bid to acquire us.

In addition to the factors described above, our Board considered the fact that some of our directors and executive officers have interests in the merger that are different from, or in addition to, the interests of our stockholders generally, as discussed in the section entitled “—Interests of Our Directors and Executive Officers in the Merger” beginning on page [●].

The above discussion of the factors considered by our Board is not intended to be exhaustive and is not provided in any specific order or ranking, but does set forth material factors considered by our Board. In view of the wide variety of factors considered in connection with its evaluation of the merger and the complexity of these matters, our Board did not consider it practicable to, and did not attempt to, quantify, rank or otherwise assign relative or specific weight or values to any of these factors, and individual directors held varied views of the relative importance of the factors considered. The seven directors who approved the merger and the five directors who voted against the merger viewed their respective position as being based on an overall review of the totality of the information available to them, including discussions with our senior management and legal and financial advisors, and overall considered these factors to support their respective determination regarding the merger. The seven directors who approved the merger determined that, in the aggregate, the potential benefits considered outweighed the potential risks or possible negative consequences of approving the merger, declaring the merger advisable and in the best interests of the Company and our stockholders and recommending that stockholders vote in favor of the approval of the merger. The five directors who voted against the merger determined that, in the aggregate, the potential risks or possible negative consequences of approving the merger considered outweighed the potential benefits of approving the merger.

Information presented in this section is forward-looking in nature and should be read in light of the cautionary statement contained in the section entitled “Cautionary Statement Concerning Forward-Looking Statements” beginning on page [●].

For the reasons set forth above, our Board, by a vote of seven to five, has approved the merger and the other transactions contemplated by the merger agreement and has declared the merger and the other transactions