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SEC Filings

PREM14A
FOREST CITY REALTY TRUST, INC. filed this Form PREM14A on 09/21/2018
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For an estimate of the amounts that would be payable to each of Messrs. LaRue and O’Brien upon a qualifying termination under their employment agreements, see the section entitled “Proposal 2Non-Binding, Advisory Vote on Merger-Related Compensation for the Company’s Named Executive Officers” beginning on page [●].

Change of Control Agreements

Messrs. Bishop and Brian Ratner and each of our executive officers who are not named executive officers are parties to change of control agreements with the Company (the “change of control agreements”). The change of control agreements provide that in the event the executive officer is terminated without cause or for disability or resigns for good reason (as defined below) within two years after a change in control, he or she will be entitled to severance benefits from the Company. The merger will constitute a change in control for purposes of the change of control agreements. All payments to the executive officers are contingent upon his or her execution of a release of claims against the Company and his or her compliance with the non-competition, non-solicitation, non-disparagement and confidentiality covenants. The change of control agreements provide that the executive officer may elect to forego the severance amounts and benefits under the agreements in exchange for the Company releasing the executive officer from the non-competition and non-solicitation covenants.

For purposes of the change of control agreements, “good reason” means the occurrence of any of the following without the employee’s consent: (1) any reduction of the employee’s annual base salary, (2) any reduction of the employee’s target bonus opportunity, (3) a material reduction in employee’s title, authority, responsibilities or reporting relationship as in effect immediately prior to the change of control, (4) the Company’s material breach of any of its obligations to employee under the change of control agreement or (5) the Company’s requirement that in order to perform his or her obligations to the Company, the employee must relocate his or her residence to a location more than 50 miles from the employee’s office location immediately prior to the change of control.

The change of control agreements provide that, in the event the executive officer’s employment is terminated by the Company without cause or for disability or by the executive officer for good reason, each of which we refer to as a qualifying termination, within two years following a change in control, the executive officer will be entitled to:

 

   

a lump sum cash severance payment equal to two times the sum of the executive’s (i) annual base salary and (ii) average annual bonus for the last three fiscal years prior to the date of the change of control;

 

   

continued medical, dental and vision insurance benefits for 18 months after the qualifying termination, with the Company subsidizing 65% of the applicable COBRA premiums;

 

   

pro rata annual bonus for year of termination based on actual performance;

 

   

outplacement services for a period of up to one year after the qualifying termination in an amount not to exceed $25,000; and

 

   

accelerated vesting of any outstanding restricted shares and, provided the qualifying termination occurs after at least one half of the applicable performance period has lapsed, pro rata vesting of any outstanding performance-based short-term and long-term cash and equity incentive awards based on the actual level of performance. All Company equity awards and long-term incentive cash awards held by an executive officer, however, will be treated as provided under the merger agreement as described further in the section entitled “The Merger Agreement—Treatment of Company Equity, Equity-Based Awards, Long-Term Incentive Cash Awards and Purchase Rights Under the Company ESPP” beginning on page [●].

For an estimate of the amounts that would be payable to Messrs. Bishop and Brian Ratner upon a qualifying termination within two years following a change in control under their change of control agreements, see the section entitled “Proposal 2—Non-Binding, Advisory Vote on Merger-Related Compensation for the Company’s

 

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