PRIVATE PLACEMENT PURCHASE AGREEMENT
Exhibit 10.2
(including any other persons or entities purchasing Notes (as defined
below) hereunder for whom the undersigned Holder holds contractual and investment authority, the
“Holder”) enters into this Private Placement Purchase Agreement (the “Agreement”) with Forest City
Enterprises, Inc., an Ohio corporation (the “Company”), on , 2009 whereby the Holder
will purchase (the “Purchase”) a portion of the Company’s 3.625% Puttable Equity-Linked Senior
Notes due 2014 (the “Notes”) that will be issued pursuant to the provisions of an Indenture dated
as of , 2009 among the Company and Bank of New York Trust Company, N.A., as Trustee
(the “Trustee”), as it may be supplemented or amended from time to time (the “Indenture”).
On and subject to the terms hereof, the parties hereto agree as follows:
Article I: Purchase of Notes
The Holder hereby agrees to purchase from the Company, and the Company hereby agrees to issue
and sell to the Holder, the following principal amount of the Notes for the cash purchase price
specified below:
Principal Amount of Notes to be Purchased: $ (the “Purchased
Notes”).
Purchase Price: % of the principal amount of the Purchased Notes ($ ).
The closing of the Purchase (the “Closing”) shall occur on a date (the “Closing Date”) no
later than three business days after the date of this Agreement. At Closing (a) the Holder shall
tender the purchase price specified above in immediately available funds and (b) the Company shall
issue to the Holder the Purchased Notes; provided, however, that the parties acknowledge that the
issuance of the Purchased Notes to the Holder may be delayed due to procedures and mechanics within
the system of the Depository Trust Company and that such delay will not be a default under this
Agreement so long as (i) the Company is using its reasonable efforts to effect the issuance of one
or more global notes representing the Purchased Notes, (ii) such delay is no longer than three
business days, and (iii) interest shall accrue on such Purchased Notes from the Closing Date.
Simultaneously with or after the Closing, the Company may issue Notes to one or more other holders,
subject to the terms of the Indenture.
Article II: 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 on the Closing
Date, to the Holder, Lazard Frères & Co. LLC and Lazard Capital Markets LLC, and all such
covenants, representations and warranties shall survive the Purchase.
Section 2.1 Power and Authorization. The Company is duly incorporated, validly
existing and in good standing, and has the power, authority and capacity to execute and deliver
this Agreement and the Indenture, to perform its obligations hereunder and thereunder, and to
consummate the Purchase contemplated hereby.
Section 2.2 Valid and Enforceable Agreements; 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 (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 regardless of whether such enforceability is
considered in a proceeding of law or equity (the “Enforceability Exceptions”). At the Closing, the
Indenture, substantially in the form of Exhibit B hereto, will have been duly executed and
delivered
by the Company and will govern the terms of the Purchased Notes, and will constitute a legal,
valid and binding obligation of the Company, enforceable against the Company in accordance with
their terms, except as such enforcement may be subject to the Enforceability Exceptions. This
Agreement, the Indenture and consummation of the Purchase will not violate, conflict with or result
in a breach of or default under (i) the charter, bylaws or other organizational documents of the
Company, (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 2.3 Validity of the Purchased Notes. The Purchased Notes have been duly
authorized by the Company and, when executed and authenticated in accordance with the provisions of
the Indenture and delivered to the Holder pursuant to the Purchase in accordance with the terms of
this Agreement, the Holder’s Purchased Notes will be valid and binding obligations of the Company,
enforceable in accordance with their terms, except that such enforcement may be subject to the
Enforceability Exceptions, and the Purchased Notes will not be subject to any preemptive,
participation, rights of first refusal and other similar rights. Assuming the accuracy of the
Holder’s representations and warranties hereunder, the Purchased Notes (a) will be issued in the
Purchase exempt from the registration requirements of the Securities Act of 1933, as amended (the
“Securities Act”) pursuant to Section 4(2) of the Securities Act and (b) will be issued in
compliance with all applicable state and federal laws concerning the issuance of the Purchased
Notes.
Section 2.4 Validity of Underlying Common Stock. The Purchased Notes will have an
equity-linked put right whereby the Purchased Notes may be converted into shares (the “Puttable
Equity-Linked Shares”) of the Company’s Class A common stock, par value $0.33 1/3 per share (the
“Common Stock”), in accordance with the terms of the Purchased Notes. The Puttable Equity-Linked
Shares have been duly authorized and reserved by the Company for issuance upon the exercise of the
equity-linked put right pursuant to the Purchased Notes and, when issued in connection with such
equity-linked put right in accordance with the terms of the Purchased Notes, will be validly
issued, fully paid and non-assessable, and the issuance of the Puttable Equity-Linked Shares will
not be subject to any preemptive, participation, rights of first refusal or other similar rights.
Section 2.5 Listing Approval. At the Closing Date, the Puttable Equity-Linked Shares
shall be listed on the New York Stock Exchange.
Section 2.6
Disclosure. On or before the first business day following the date of
this Agreement, the Company shall issue a publicly available press release and/or file with the
Securities and Exchange Commission (the “SEC”) a Current Report on Form 8-K disclosing all material
terms of the Purchase (to the extent not previously publicly disclosed).
Article III: Covenants, Representations and Warranties of the Holder
The Holder 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 on the Closing
Date, to the Company, Lazard Frères & Co. LLC and Lazard Capital Markets LLC, and all such
covenants, representations and warranties shall survive the Purchase.
Section 3.1
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 Purchase contemplated
hereby. If the Holder that is signatory hereto is executing this Agreement to effect the purchase
of Notes by one or more other persons or entities (who are thus included in the definition of
“Holder” hereunder), (a) such signatory Holder has all requisite discretionary authority to enter
into this Agreement on behalf of, and bind, each such other person or entity that is acquiring
Purchased Notes, and (b) Exhibit A hereto is a true, correct and complete list of (i) the
name of each party acquiring (as beneficial owner) Purchased Notes hereunder, and (ii) the
principal amount of Purchased Notes being acquired by such Holder.
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Section 3.2 Valid and Enforceable Agreement; No Violations. This Agreement has been
duly executed and delivered by the Holder and constitutes a legal, valid and binding obligation of
the Holder, enforceable against the Holder in accordance with its terms, except as such enforcement
may be subject to the Enforceability Exceptions. This Agreement and consummation of the Purchase
will not violate, conflict with or result in a breach of or default under (i) the Holder’s
organizational documents, (ii) any agreement or instrument to which the Holder is a party or by
which the Holder or any of its assets are bound, or (iii) any laws, regulations or governmental or
judicial decrees, injunctions or orders applicable to the Holder.
Section 3.3 Accredited Investor; Qualified Institutional Buyer. The Holder is an
“accredited investor” within the meaning of Rule 501 of Regulation D promulgated under the
Securities Act. The Holder is a “qualified institutional buyer” within the meaning of Rule 144A
promulgated under the Securities Act.
Section 3.4 Restricted Stock. The Holder (a) acknowledges that the issuance of the
Purchased Notes pursuant to the Purchase, and the issuance of any of the Puttable Equity-Linked
Shares upon conversion of the Purchased Notes, have not been registered under the Securities Act or
any state securities laws, and the Purchased Notes and Puttable Equity-Linked Shares are being
offered and sold in reliance upon exemptions provided in the Securities Act and state securities
laws for transactions not involving any public offering and, therefore, cannot be sold,
transferred, offered for sale, pledged, hypothecated or otherwise disposed of unless they are
subsequently registered and qualified under the Securities Act and applicable state laws or unless
an exemption from such registration and qualification is available, and that evidence of the
Purchased Notes and Puttable Equity-Linked Shares will bear a legend to such effect, and (b) is
purchasing the Purchased Notes and Puttable Equity-Linked Shares for investment purposes only for
the account of the Holder and not with any view toward a distribution thereof or with any intention
of selling, distributing or otherwise disposing of the Purchased Notes or Puttable Equity-Linked
Shares in a manner that would violate the registration requirements of the Securities Act. The
Holder is able to bear the economic risk of holding the Purchased Notes and Puttable Equity-Linked
Shares for an indefinite period and has sufficient knowledge and experience in financial and
business matters so as to be capable of evaluating the merits and risk of its investment in the
Purchased Notes and Puttable Equity-Linked Shares.
Section 3.5 Affiliate Status, Related Party or 5% Stockholder 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. The Holder and its Affiliates collectively beneficially own
and will beneficially own as of the Closing Date (but without giving effect to the Purchase) less
than 5% of the Common Stock. 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 (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 of the Holder.
Section 3.6 No Prohibited Transactions. The Holder has not, directly or indirectly,
and no person acting on behalf of or pursuant to any understanding with the Holder 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 such Holder was
first contacted by either the Company, Lazard Frères & Co. LLC or Lazard Capital Markets LLC or any
other person regarding an investment in the Purchased Notes or the Company. Such Holder covenants
that neither it nor any person acting on its behalf or pursuant to any understanding with such
Holder 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 3.6, subject to the Holder’s compliance
with its obligations under the U.S. federal securities laws and the Holder’s internal policies,
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“Holder” shall not be deemed to include any subsidiaries or affiliates of the Holder that are
effectively walled off by appropriate “Chinese Wall” information barriers approved by the Holder’s
legal or compliance department (and thus have not been privy to any information concerning the
Purchase).
Section 3.7 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 Purchase and has had the opportunity to review the Company’s
filings with the SEC, including, without limitation, all filings made 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 Purchase, (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
purchase of the Purchased Notes pursuant hereto and to make an informed investment decision with
respect to such Purchase and (d) the Holder is not relying, and has not relied, upon any statement,
advice (whether legal, tax, financial, accounting or other), representation or warranty made by the
Company or any of its affiliates or representatives including, without limitation, Lazard Frères &
Co. LLC and Lazard Capital Markets LLC, except for (i) the publicly available filings made by the
Company with the SEC under the Exchange Act and (ii) the representations and warranties made by the
Company in this Agreement.
Section 3.8 No Public Market. The Holder understands that no public market exists for
the Purchased Notes, and that there is no assurance that a public market will ever develop for the
Purchased Notes.
Article IV: Miscellaneous
Section 4.1 Entire Agreement. This Agreement and any documents and agreements
executed in connection with the Purchase 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.
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.
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[Signature page to follow]
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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.
| “HOLDER”: | FOREST CITY ENTERPRISES, INC. | |||||||||
By: |
By: | |||||||||
Name: |
Name: |
|||||||||
Title: |
Title: | |||||||||
EXHIBIT A
Purchasing Beneficial Owners
Purchasing Beneficial Owners
| Name of | Principal Amount of | ||||
| Beneficial Owner | Purchased Notes | ||||
EXHIBIT B
Indenture
Indenture
