Exhibit 10.1
EXCHANGE AGREEMENT
___________________ (the “Undersigned”), for itself and on behalf of the
beneficial owners listed on Exhibit A hereto (“Accounts”) for whom the
Undersigned holds contractual and investment authority (each Account, as well as
the Undersigned if it is exchanging Preferred Stock (as defined below)
hereunder, a “Holder”), enters into this Exchange Agreement (the “Agreement”)
with Forest City Enterprises, Inc., an Ohio corporation (the “Company”), on
December ___, 2012 whereby the Holders will exchange (the “Exchange”) shares of
the Company's Series A Cumulative Perpetual Convertible Preferred Stock (the
“Preferred Stock”) for shares of the Company's Class A common stock, par value
$0.33 1/3 per share (the “Class A Common Stock”), and a cash payment.
On and subject to the terms hereof, the parties hereto agree as follows:
Article I: Exchange of the Preferred Stock for Class A Common Stock
Subject to the terms set forth in this Agreement, at the Closing (as defined
herein), the Undersigned hereby agrees to cause the Holders to exchange and
deliver to the Company the following number of shares of Preferred Stock, and in
exchange therefor the Company hereby agrees to issue to the Holders the number
of shares of Class A Common Stock described below and to pay in cash the
following amounts for additional consideration in the Exchange and in lieu of
fractional shares of Class A Common Stock that would otherwise be issuable in
the Exchange:

Number of Shares of Preferred Stock to be Exchanged:
______________________________
(the “Exchanged Preferred Shares”).

Number of Shares of Class A Common Stock to be issued in the Exchange:
______________________
(the “Common Shares”).
Cash for Additional Exchange Consideration
(the “Additional
Consideration”):.....................................    $_____________________________.

Cash in Lieu of Fractional Shares
(the “Cash for Fractional
Shares”):...................................$_____________________________.

Total Cash Payment (sum of the Additional Consideration
and Cash for Fractional Shares)
(the “Total Cash
Payment”):................................................$_____________________________.
Unless delayed as set forth below, the closing of the Exchange (the “Closing”)
shall occur on a date (the “Closing Date”) no later than three business days
after the date of this Agreement. At the Closing, (a) each Holder shall deliver
or cause to be delivered to the Company all right, title and interest in and to
its Exchanged Preferred Shares free and clear of any mortgage, lien, pledge,
charge, security interest, encumbrance, title retention agreement, option,
equity or other adverse claim thereto (collectively, “Liens”), together with any
documents of conveyance or transfer that the Company may deem necessary or
desirable to transfer to and confirm in the Company all right, title and
interest in and to the Exchanged Preferred Shares free and clear of any Liens,
and (b) the Company shall deliver to each Holder the number of Common Shares and
the portion of the Total Cash Payment specified on Exhibit A hereto (or, if
there are no Accounts, the Company shall deliver to the Undersigned, as the sole
Holder, all of the Common Shares and Total Cash Payment specified above);
provided, however, that the parties acknowledge that the Company may delay the
Closing and the delivery of the Common Shares to the Holders due to procedures
and mechanics within the system of the Depository Trust Company or the New York
Stock Exchange (including the procedures and mechanics regarding the listing of
the Common Shares on the New York Stock Exchange), or events beyond the
Company's control, and that such

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delay will not be a default under this Agreement so long as (i) the Company is
using its best efforts to effect the issuance of the Common Shares, and
(ii) such delay is no longer than five business days.
Article II: Covenants, Representations and Warranties of the Holders
Each Holder (and, where specified below, the Undersigned) hereby covenants
(solely as to itself) as follows, and makes the following representations and
warranties (solely as to itself), each of which is and shall be true and correct
on the date hereof and at the Closing, to the Company, and all such covenants,
representations and warranties shall survive the Closing.
Section 2.1    Power and Authorization. The Holder is duly organized, validly
existing and in good standing, and has the power, authority and capacity to
execute and deliver this Agreement, to perform its obligations hereunder, and to
consummate the Exchange contemplated hereby. If the Undersigned is executing
this Agreement on behalf of Accounts, (a) the Undersigned has all requisite
discretionary and contractual authority to enter into this Agreement on behalf
of, and bind, each Account, and (b) Exhibit A hereto is a true, correct and
complete list of (i) the name of each Account, (ii) the number of such Account's
Exchanged Preferred Shares (iii) the number of Common Shares to be issued to
such Account in respect of its Exchanged Preferred Shares, and (iv) the portions
of the Additional Consideration, Cash for Fractional Shares and Total Cash
Payment to be paid to such Account.
Section 2.2    Valid and Enforceable Agreement; No Violations. This Agreement
has been duly executed and delivered by the Undersigned and the Holder and
constitutes a legal, valid and binding obligation of the Undersigned and the
Holder, enforceable against the Undersigned and the Holder in accordance with
its terms, except that such enforcement may be subject to (a) bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar
laws affecting or relating to enforcement of creditors' rights generally, and
(b) general principles of equity, whether such enforceability is considered in a
proceeding at law or in equity (the “Enforceability Exceptions”). This Agreement
and consummation of the Exchange will not violate, conflict with or result in a
breach of or default under (i) the Undersigned's or the Holder's organizational
documents, (ii) any agreement or instrument to which the Undersigned or the
Holder is a party or by which the Undersigned or the Holder or any of their
respective assets are bound, or (iii) any laws, regulations or governmental or
judicial decrees, injunctions or orders applicable to the Undersigned or the
Holder.
Section 2.3    Title to the Exchanged Preferred Shares. The Holder is the sole
legal and beneficial owner of the Exchanged Preferred Shares set forth opposite
its name on Exhibit A hereto (or, if there are no Accounts, the Undersigned is
the sole legal and beneficial owner of all of the Exchanged Preferred Shares).
The Holder has good, valid and marketable title to its Exchanged Preferred
Shares, free and clear of any Liens (other than pledges or security interests
that the Holder may have created in favor of a prime broker under and in
accordance with its prime brokerage agreement with such broker). The Holder has
not, in whole or in part, except as described in the preceding sentence,
(a) assigned, transferred, hypothecated, pledged, exchanged or otherwise
disposed of any of its Exchanged Preferred Shares or its rights in its Exchanged
Preferred Shares, or (b) given any person or entity any transfer order, power of
attorney or other authority of any nature whatsoever with respect to its
Exchanged Preferred Shares. Upon the Holder's delivery of its Exchanged
Preferred Shares to the Company pursuant to the Exchange, such Exchanged
Preferred Shares shall be free and clear of all Liens created by the Holder.
Section 2.4    Accredited Investor. The Holder is an “accredited investor”
within the meaning of Rule 501 of Regulation D promulgated under the Securities
Act of 1933, as amended (the “Securities Act”).
Section 2.5    No Affiliate, Related Party or 5% Shareholder Status. The Holder
is not, and has not been during the consecutive three month period preceding the
date hereof, a director, officer or “affiliate” within the meaning of Rule 144
promulgated under the Securities Act (an “Affiliate”) of the Company. To its
knowledge, the Holder did not acquire any of the Exchanged Preferred Shares,
directly or indirectly, from an Affiliate of the Company. The Holder and its
Affiliates collectively beneficially own and will beneficially own

                            
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as of the Closing Date (but without giving effect to the Exchange) (i) less than
5% of the aggregate outstanding shares of the Company's Class A Common Stock and
Class B common stock, par value $0.33 1/3 per share (the “Class B Common Stock;”
and together with the Class A Common Stock, the “Common Stock”), and (ii) less
than 5% of the aggregate number of votes that may be cast by holders of those
outstanding securities of the Company that entitle the holders thereof to vote
generally on all matters submitted to the Company's shareholders for a vote (the
“Voting Power”). The Holder is not a subsidiary, affiliate or, to its knowledge,
otherwise closely-related to any director or officer of the Company or
beneficial owner of 5% or more of the outstanding Common Stock or Voting Power
(each such director, officer or beneficial owner, a “Related Party”). To its
knowledge, no Related Party beneficially owns 5% or more of the outstanding
voting equity, or votes entitled to be cast by the outstanding voting equity, of
the Holder.
Section 2.6    No Illegal Transactions. Each of the Undersigned and the Holder
has not, directly or indirectly, and no person acting on behalf of or pursuant
to any understanding with it has, engaged in any transactions in the securities
of the Company (including, without limitation, any Short Sales (as defined
below) involving any of the Company's securities) since the time that the
Undersigned first contacted the Company, this Agreement or an investment in the
Class A Common Stock or the Company. Each of the Undersigned and the Holder
covenants that neither it nor any person acting on its behalf or pursuant to any
understanding with it will engage, directly or indirectly, in any transactions
in the securities of the Company (including Short Sales) prior to the time the
transactions contemplated by this Agreement are publicly disclosed. “Short
Sales” include, without limitation, all “short sales” as defined in Rule 200 of
Regulation SHO promulgated under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), and all types of direct and indirect stock pledges,
forward sale contracts, options, puts, calls, short sales, swaps, derivatives
and similar arrangements (including on a total return basis), and sales and
other transactions through non-U.S. broker-dealers or foreign regulated brokers.
Solely for purposes of this Section 2.6, subject to the Undersigned's and the
Holder's compliance with their respective obligations under the U.S. federal
securities laws and the Undersigned's and the Holder's respective internal
policies, (a) “Undersigned” and “Holder” shall not be deemed to include any
employees, subsidiaries or affiliates of the Undersigned or the Holder that are
effectively walled off by appropriate “Chinese Wall” information barriers
approved by the Undersigned's or the Holder's respective legal or compliance
department (and thus have not been privy to any information concerning the
Exchange), and (b) the foregoing representations of this Section 2.6 shall not
apply to any transaction by or on behalf of an Account that was effected without
the advice or participation of, or such Account's receipt of information
regarding the Exchange provided by, the Undersigned.
Section 2.7    Adequate Information; No Reliance. The Holder acknowledges and
agrees that (a) the Holder has been furnished with all materials it considers
relevant to making an investment decision to enter into the Exchange and has had
the opportunity to review the Company's filings and submissions with the
Securities and Exchange Commission (the “SEC”), including, without limitation,
all information filed or furnished pursuant to the Exchange Act, (b) the Holder
has had a full opportunity to ask questions of the Company concerning the
Company, its business, operations, financial performance, financial condition
and prospects, and the terms and conditions of the Exchange, (c) the Holder has
had the opportunity to consult with its accounting, tax, financial and legal
advisors to be able to evaluate the risks involved in the Exchange and to make
an informed investment decision with respect to such Exchange, and (d) the
Holder is not relying, and has not relied, upon any statement, advice (whether
accounting, tax, financial, legal or other), representation or warranty made by
the Company or any of its affiliates or representatives including, except for
(i) the publicly available filings and submissions made by the Company with the
SEC under the Exchange Act and (ii) the representations and warranties made by
the Company in this Agreement.
Article III: Covenants, Representations and Warranties of the Company
The Company hereby covenants as follows, and makes the following representations
and warranties, each of which is and shall be true and correct on the date
hereof and at the Closing, to the Holders, and all such covenants,
representations and warranties shall survive the Closing.

                            
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Section 3.1    Power and Authorization. The Company is duly incorporated,
validly existing and in good standing under the laws of its state of
incorporation, and has the power, authority and capacity to execute and deliver
this Agreement, to perform its obligations hereunder, and to consummate the
Exchange contemplated hereby.
Section 3.2    Valid and Enforceable Agreement; No Violations. This Agreement
has been duly executed and delivered by the Company and constitutes a legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except that such enforcement may be subject to the
Enforceability Exceptions. This Agreement and consummation of the Exchange will
not violate, conflict with or result in a breach of or default under (i) the
Company's charter, bylaws or other organizational documents, (ii) any agreement
or instrument to which the Company is a party or by which the Company or any of
its assets are bound, or (iii) any laws, regulations or governmental or judicial
decrees, injunctions or orders applicable to the Company.
Section 3.3    Valid Issuance of the Class A Common Stock. The Common Shares
have been duly authorized by the Company and, when issued and delivered pursuant
to the Exchange against delivery of the Exchanged Preferred Shares in accordance
with the terms of this Agreement, the Common Shares will be validly issued,
fully paid and non-assessable. The Common Shares will not, at the Closing, be
subject to any preemptive, participation, rights of first refusal or other
similar rights. Assuming the accuracy of each Holder's representations and
warranties hereunder, the Common Shares (a) will be issued in the Exchange
exempt from the registration requirements of the Securities Act pursuant to
Section 4(2) of the Securities Act, (b) will, at the Closing, be free of any
restrictions on resale by such Holder pursuant to Rule 144 promulgated under the
Securities Act, and (c) will be issued in compliance with all applicable state
and federal laws concerning the issuance of the Common Shares.
Section 3.4    Listing. When issued and delivered in the Exchange, the Common
Shares shall be listed on the New York Stock Exchange.
Section 3.5    Disclosure. On or before the first business day following the
date of this Agreement, the Company shall issue a publicly available press
release or file with the SEC a Current Report on Form 8-K disclosing all
material terms of the Exchange (to the extent not previously publicly
disclosed).
Article IV: Miscellaneous
Section 4.1    Entire Agreement. This Agreement and any documents and agreements
executed in connection with the Exchange embody the entire agreement and
understanding of the parties hereto with respect to the subject matter hereof
and supersede all prior and contemporaneous oral or written agreements,
representations, warranties, contracts, correspondence, conversations, memoranda
and understandings between or among the parties or any of their agents,
representatives or affiliates relative to such subject matter, including,
without limitation, any term sheets, emails or draft documents.
Section 4.2    Construction. References in the singular shall include the
plural, and vice versa, unless the context otherwise requires. References in the
masculine shall include the feminine and neuter, and vice versa, unless the
context otherwise requires. Headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meanings of the
provisions hereof. Neither party, nor its respective counsel, shall be deemed
the drafter of this Agreement for purposes of construing the provisions of this
Agreement, and all language in all parts of this Agreement shall be construed in
accordance with its fair meaning, and not strictly for or against either party.
Section 4.3    Governing Law. This Agreement shall in all respects be construed
in accordance with and governed by the substantive laws of the State of New
York, without reference to its choice of law rules.

                            
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Section 4.4    Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument. Any counterpart or other signature
hereon delivered by facsimile shall be deemed for all purposes as constituting
good and valid execution and delivery of this Agreement by such party.
[Signature Page Follows]

                            
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed as of the date first above written.

“UNDERSIGNED”: _______________________________________
(in its capacities described in the first paragraph hereof)
By: _________________________________
Name: _______________________________
Title: ________________________________
“COMPANY”:
FOREST CITY ENTERPRISES, INC.

By:________________________________________
Name: _____________________________________
Title: ______________________________________

Signature Page to Exchange Agreement
Series A Cumulative Perpetual Convertible Preferred Stock due 2014 for Class A
Common Stock

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EXHIBIT A
Exchanging Beneficial Owners

Name of
Beneficial Owner
Number of Exchanged Preferred Shares
Number of Common Shares
Additional Consideration
Cash for Fractional Shares
Total Cash Payment