FOREST CITY ENTERPRISES INC
EX-10.1
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<TYPE>EX-10.1
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<DESCRIPTION>EX-10.1
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt">EXHIBIT 10.1
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<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><U>AGREEMENT</U>
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">THIS
AGREEMENT MADE AND ENTERED INTO this 9<SUP style="font-size: 85%; vertical-align: text-top">th</SUP> day of November, 2006, by and between
FOREST CITY ENTERPRISES, INC., an Ohio corporation, (&#147;the Company&#148;), and BRUCE C. RATNER (&#147;the
Employee&#148;).
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 &#147;NY SBU&#148;), reporting
to the Company&#146;s President and Chief Executive Officer; and
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the NY SBU shall operate in a manner that is consistent with the Company&#146;s corporate
policies and requirements for all of its Strategic Business Units.
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW, THEREFORE, it is agreed that:
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;The
effective date of this Employment Agreement is November 9, 2006 (the &#147;Effective
Date&#148;).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U><B>Term</B></U>: 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)&nbsp;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 &#147;NY SBU&#148;), 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)&nbsp;year each until termination by mutual consent, death, or by either
party giving ninety (90)&nbsp;days written notice to either amend or terminate this Employment Agreement
to the other party prior to the termination of any such one (1)&nbsp;year period.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U><B>Compensation</B></U>:
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<DIV style="margin-top: 6pt">
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    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>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&#146;s customary payroll practices for
executives.</TD>
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<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Employee will be eligible to participate in the Company&#146;s executive
bonus plan in accordance with the terms established by the Compensation Committee
on the same basis as other senior management executives.</TD>
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<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
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    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>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.</TD>
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U><B>Noncompetition, Nonsolicitation</B></U>:
</DIV>

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    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>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&nbsp;1031 tax free exchange under
the Internal Revenue Code, with the prior approval of the Company&#146;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&#146;s annual conflict of
interest questionnaire distributed to management, as required by the Audit
Committee of the Board of Directors.
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    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Employee agrees that so long as he is employed by the Company, and for
a period of two (2)&nbsp;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&#146;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&nbsp;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&#146;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&#146;s employment under this Agreement is terminated by the Company without
&#147;Cause&#148; (as hereinafter defined), the two (2)&nbsp;year period set forth in this
provision 4(b) shall be reduced to one (1)&nbsp;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.</TD>
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<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Employee agrees that so long as he is employed by the Company, and for
a one (1)&nbsp;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)&nbsp;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)&nbsp;year.</TD>
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    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left">d)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>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.</TD>
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;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)&nbsp;year
period, or any renewal thereof, without notice, for any conduct on the part of the Employee which
injures the Company&#146;s business, such as, but not limited to, intemperance, negligence, failure to
follow instructions or perform and fulfill the obligations on the Employee&#146;s part to be performed
hereunder to the satisfaction of the Company.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties hereto have set their hands the day and year first above
written.
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    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">FOREST CITY ENTERPRISES, INC.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
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    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
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    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ CHARLES A. RATNER
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="1" valign="top" align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="1" valign="top" align="left">Charles A. Ratner, CEO</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD>&nbsp;</TD>
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    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ THOMAS G. SMITH</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="1" valign="top" align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="1" valign="top" align="left">Thomas G. Smith, Secretary</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD>&nbsp;</TD>
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    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">/s/ BRUCE C. RATNER</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">BRUCE C. RATNER, Employee</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
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