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DEFM14A
FOREST CITY REALTY TRUST, INC. filed this Form DEFM14A on 10/12/2018
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or “—Opinion of Goldman Sachs” and by our Board in connection with its consideration of the merger. Financial measures provided to a financial advisor are excluded from the definition of non-GAAP financial measures and therefore are not subject to SEC rules regarding disclosures of non-GAAP financial measures, which would otherwise require a reconciliation of a non-GAAP financial measure to a GAAP financial measure. Reconciliations of non-GAAP financial measures were not relied upon by Lazard or Goldman Sachs for purposes of its respective opinion to our Board as described above in the sections entitled “—Opinion of Lazard” or “—Opinion of Goldman Sachs” or by our Board in connection with its consideration of the merger. Accordingly, we have not provided a reconciliation of the financial measures included in the financial projections above.

The NAV information was not prepared in accordance with GAAP. We consider NAV to be a useful supplemental measure which assists both management and investors to estimate the fair value of the Company. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Our calculation of NAV may differ from others in the industry and NAV is not necessarily comparable with similar titles used by other companies. There is no directly comparable GAAP financial measure to NAV. Accordingly, we have not provided a reconciliation of the NAV information included above.

In the view of our senior management, the financial projections and NAV information were prepared on a reasonable basis reflecting management’s best available estimates and judgments regarding our future financial performance at the time they were prepared.

The financial projections and NAV information, while presented with numerical specificity, were based on numerous variables, estimates and assumptions that necessarily involve judgments with respect to, among other things, future economic, competitive, regulatory and financial market conditions, all of which are difficult or impossible to predict and many of which are beyond our control. The financial projections and NAV information were developed under the assumption of continued standalone operation, do not take into account any circumstances, transactions or events occurring after the date on which such information was prepared and do not give effect to any changes or expenses as a result of the merger or any effects of the merger. Further, the financial projections and NAV information do not take into account the effect of any failure of the merger to be consummated and should not be viewed as accurate or continuing in that context. The financial projections and NAV information also reflect assumptions as to certain business decisions that are subject to change. Given that the financial projections and NAV information cover multiple years, by their nature, they become subject to greater uncertainty with each successive year. Important factors that may affect actual results and the achievability of the financial projections and/or the NAV information include, but are not limited to, local market conditions, general economic conditions and disruptions in the financial, debt, capital, credit or securities markets, developing industry dynamics, competition, our ability to obtain financing, construction, development and redevelopment costs, changes in business strategy and those risks and uncertainties described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, our Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 and our Current Reports on Form 8-K. For additional information on factors that may cause our future financial results to materially vary from the projected results summarized above, see the section entitled “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 20.

The financial projections and NAV information also reflect assumptions that are subject to change and are susceptible to multiple interpretations and periodic revisions based on actual results, revised prospects for our business, changes in general business or economic conditions, certain accounting assumptions, timing of business investments, changes in actual or projected cash flows, competitive pressures and changes in tax or other laws or regulations or any other transaction or event that has occurred or that may occur and that was not anticipated when the financial projections or the NAV information were prepared. In addition, the financial projections and/or NAV information may be affected by our ability to achieve strategic goals, objectives and targets over the applicable period, and estimates of the NAV of our assets may not be fully realizable upon a future liquidation or sale of a company for a variety of other reasons, including the difficulty in executing sales of assets on favorable terms even if sold in multi-asset packages of significant scale. In addition, the NAV information does not

 

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