Forest City Announces Pricing of $250 Million Convertible Senior Notes

    Forest City Announces Pricing of $250 Million Convertible Senior Notes

PR Newswire

CLEVELAND, July 16, 2013

CLEVELAND, July 16, 2013 /PRNewswire/ --Forest City Enterprises, Inc. (NYSE:
FCEA and FCEB) today announced the pricing of its offering of $250 million
aggregate principal amount of convertible senior notes due 2020 (the "Notes"),
which will be sold to qualified institutional buyers pursuant to Rule 144A
under the Securities Act of 1933, as amended (the "Securities Act"). The
offering price of the notes will be 100 percent of their principal amount.
Forest City has also granted the initial purchasers of the Notes a 13-day
option to purchase up to an additional $50 million aggregate principal amount
of the Notes to cover overallotments.

(Logo: http://photos.prnewswire.com/prnh/20080515/FRSTCTYLOGO )

The Notes will pay interest semiannually at a rate of 3.625 percent per annum.
The Notes are convertible, at the holder's option, into shares of Forest
City's Class A common stock at a conversion rate of 41.3129 shares per $1,000
principal amount of Notes, subject to adjustment in certain circumstances.
This conversion rate is equal to a conversion price of approximately $24.21
per share, a 35 percent premium over the $17.93 closing price of Forest City's
Class A common stock on the New York Stock Exchange on July 15, 2013.

The Notes will be general senior unsecured obligations of Forest City
Enterprises, Inc.

The Notes are redeemable at Forest City's option, in whole or in part, at any
time up to August 15, 2018, at par plus accrued and unpaid interest, so long
as the Daily VWAP of Forest City's Class A common stock for at least 20
trading days (whether or not consecutive) during any period of 30 consecutive
trading days ending within 5 trading days immediately prior to the date of the
redemption notice has equaled or exceeded 130% of the applicable conversion
price for the Notes on each applicable trading day, and, in whole or in part,
at any time from and including August 15, 2018, up to the maturity date at par
plus accrued and unpaid interest.

Forest City estimates that the net proceeds from this offering will be
approximately $242.5 million (or approximately $291.0 million if the initial
purchasers' option is exercised in full) after deducting the initial
purchasers' discounts and commissions and estimated offering expenses. Forest
City intends to use the net proceeds from this offering to repay the
outstanding balance of its 6.500% Senior Notes due 2017 and other outstanding
debt. Pending application of the net proceeds as described above, the proceeds
will be held in an escrow account and invested in short-term, investment
grade, interest bearing securities. The closing of this offering is expected
to occur on July 19, 2013.

The Notes and the shares of Forest City's Class A common stock issuable upon
conversion of the Notes have not been registered under the Securities Act, or
any state securities laws, and unless so registered, may not be offered or
sold in the United States except pursuant to an exemption from the
registration requirements of the Securities Act and applicable state laws.

No Solicitation

This press release shall not constitute an offer to sell or a solicitation of
an offer to buy nor shall there be any sale of these securities in any state
or other jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such state or other jurisdiction.

About Forest City
Forest City Enterprises, Inc. is an NYSE-listed national real estate company
with $10.6 billion in total assets. The company is principally engaged in the
ownership, development, management and acquisition of commercial and
residential real estate and land throughout the United States. For more
information, visit www.forestcity.net.

SOURCE Forest City Enterprises, Inc.

Website: http://www.forestcity.net
Contact: Robert O'Brien, Executive Vice President - Chief Financial Officer,
216-621-6060; Jeff Linton, Senior Vice President - Corporate Communication,
216-416-3558
 
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