EXHIBIT 10.1
AGREEMENT
THIS AGREEMENT MADE AND ENTERED INTO this 9th day of November, 2006, by and
between FOREST CITY ENTERPRISES, INC., an Ohio corporation, (“the Company”), and
BRUCE C. RATNER (“the Employee”).
     WHEREAS, the Company and the Employee desire to enter into a new Employment
Agreement under which the Employee shall serve as an executive of the Company,
as well as continue to serve as the President and Chief Executive Officer of the
Forest City Ratner Companies (the “NY SBU”), reporting to the Company’s
President and Chief Executive Officer; and
     WHEREAS, the NY SBU shall operate in a manner that is consistent with the
Company’s corporate policies and requirements for all of its Strategic Business
Units.
     NOW, THEREFORE, it is agreed that:
     1. The effective date of this Employment Agreement is November 9, 2006 (the
“Effective Date”).
     2. Term: The Employee, in consideration of the promises and agreements of
the Company herein contained, hereby promises to continue in the employ of the
Company for a period of one (1) year from the Effective Date, as an executive of
the Company, as well as continue to serve as the President and Chief Executive
Officer of Forest City Ratner Companies (the “NY SBU”), and to perform such
duties as may be required of him in such capacities by the Company, faithfully,
honestly, diligently and to the satisfaction of the Company. Said employment
shall continue for additional periods of one (1) year each until termination by
mutual consent, death, or by either party giving ninety (90) days written notice
to either amend or terminate this Employment Agreement to the other party prior
to the termination of any such one (1) year period.
     3. Compensation:

  a)   The Company promises and agrees to pay the Employee a base salary of FOUR
HUNDRED AND FIFTY THOUSAND DOLLARS ($450,000.00) per year, payable during each
employment year in accordance with the Company’s customary payroll practices for
executives.     b)   The Employee will be eligible to participate in the
Company’s executive bonus plan in accordance with the terms established by the
Compensation Committee on the same basis as other senior management executives.
    c)   The employee will be eligible to receive equity based awards in
accordance with the terms established by the Compensation Committee on the same
basis as other senior management executives.

     4. Noncompetition, Nonsolicitation:

  a)   Except for the rights granted to Employee under provision 4(b), the
Company acknowledges that the Employee owns and will continue to own, alone or
in conjunction with others, a certain resort condominium development which has
not been transferred to the Company. This property may be managed, developed,
expanded, operated and sold by the owners, independently of the business of the
Company. Should the Employee sell a portion or all of this property, Employee
may purchase additional property, to effectuate a Section 1031 tax free exchange
under the Internal Revenue Code, with the prior approval of the Company’s Audit
Committee. Except for this property, and any potential purchase of property to
effect a tax deferred transaction, Employee will engage in all business
activities of the type conducted by the Company only through and on behalf of
the Company, as long as he is employed by the Company. Employee further agrees
to update such disclosure on an annual basis in connection with the Company’s
annual conflict of interest questionnaire distributed to management, as required
by the Audit Committee of the Board of Directors.

 

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  b)   Employee agrees that so long as he is employed by the Company, and for a
period of two (2) years thereafter, he will not without the prior consent of the
Company, directly or indirectly, become an employee, shareholder, owner,
officer, agent, director of, render consulting services, advise, or otherwise be
associated with any firm, person, business enterprise or other entity which is
engaged in or competitive with, any business engaged in by the Company or its
affiliates in any of its core markets, as such core markets are defined in the
Company’s most recently filed Form 10-K or 10-Q . Notwithstanding the foregoing,
Employee may invest in commercial, industrial and residential real estate
properties or projects as a passive investor holding directly and indirectly, up
to 10 percent (10%) of the equity of any such entity, as long as such ownership
interest is not deemed a majority or controlling interest in the entity. For
purposes of this provision, Employee will be deemed to be a passive investor in
an entity only if he does not, directly or indirectly, participate in or control
either the day to day or strategic management of the entity. Employee shall also
be permitted to perform philanthropic activities or work for not-for-profit
entities, public agencies or governmental authorities provided such activities
have been previously disclosed to the Company’s Audit Committee and do not
present a conflict of interest and Employee receives no compensation for such
philanthropic activities. If, and only if, Employee’s employment under this
Agreement is terminated by the Company without “Cause” (as hereinafter defined),
the two (2) year period set forth in this provision 4(b) shall be reduced to one
(1) year. Cause shall be defined as gross neglect of duty, dishonesty,
conviction of a felony, disloyalty, intoxication, drug addiction or other
similar misconduct adverse to the best interests of the Company.     c)  
Employee agrees that so long as he is employed by the Company, and for a one
(1) year period thereafter, Employee shall not, directly or indirectly, (i)
solicit or induce any employee of the Company or any of its affiliates to
terminate their employment, or (ii) employ or offer employment to any person who
was employed by the Company or its affiliates in other than a purely
administrative capacity unless such person shall have ceased to be employed by
the Company or its affiliates for a period of at least one (1) year.     d)   It
is the intention of the parties hereto that the restriction contained in this
paragraph 4 be enforceable to the fullest extent permitted by applicable law.
Therefore, to the extent any court of competent jurisdiction shall determine
that any portion of the foregoing restrictions is excessive, such provision
shall not be entirely void, but rather shall be limited or revised only to the
extent necessary to make it enforceable.

     5. It is mutually agreed by and between the parties hereto that the Company
may cancel or terminate this Employment Agreement at any time prior to the
expiration of said one (1) year period, or any renewal thereof, without notice,
for any conduct on the part of the Employee which injures the Company’s
business, such as, but not limited to, intemperance, negligence, failure to
follow instructions or perform and fulfill the obligations on the Employee’s
part to be performed hereunder to the satisfaction of the Company.
     IN WITNESS WHEREOF, the parties hereto have set their hands the day and
year first above written.

                  FOREST CITY ENTERPRISES, INC.    
 
           
 
  By:   /s/ CHARLES A. RATNER                           Charles A. Ratner, CEO  
 
 
           
 
  By:   /s/ THOMAS G. SMITH                           Thomas G. Smith, Secretary
   
 
                /s/ BRUCE C. RATNER                   BRUCE C. RATNER, Employee