<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
=========
Quarterly Report Under Section 13 or 15(d) of
The Securities Exchange Act Of 1934
For the Quarter ended Commission File Number
March 31, 1994 0-9811
- - ---------------------- ----------------------
BFC FINANCIAL CORPORATION
=========================
Florida 59-2022148
- - ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1750 E. Sunrise Boulevard
Fort Lauderdale, Florida 33304
- - ---------------------------------------- ---------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (305) 760-5200
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
------ ------
Indicate the number of shares outstanding of the issuer's classes of common
stock as of May 12, 1994.
Class Shares Outstanding
----- ------------------
Common stock, par value 2,305,682
$0.01 per share
Special Class A
Common stock, par value
$0.01 par value None outstanding
BFC Financial Corporation and Subsidiaries
Consolidated Statements of Financial Condition
March 31, 1994 and December 31, 1993
(in thousands, except share data)
(Unaudited)
ASSETS
--------
March 31, December 31,
1994 1993
---------- ---------
Cash $ 57 78
Trading securities, net 8,190 20,644
Investment in BankAtlantic, a Federal Savings Bank 38,162 36,436
Loans receivable, net 9,132 9,179
Real estate acquired in debenture exchange, net 18,078 18,315
Other assets 15,461 2,843
--------- ---------
Total assets $ 89,080 87,495
========= =========
LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------
Exchange debentures, net $ 35,705 35,651
Mortgages payable and other borrowing 30,122 30,367
Deferred interest on the exchange debentures 13,805 12,049
Other liabilities 8,614 8,602
Deferred income taxes 2,018 2,038
--------- ---------
Total liabilities 90,264 88,707
--------- ---------
Commitments and contingencies
Redeemable common stock (353,478 shares in 1993)
(redemption amount $299 in 1993) - 5,776
Stockholders' deficit:
Preferred stock of $.01 par value; authorized
1,000,000 shares; none issued _ _
Special class A common stock of $.01 par value;
authorized 20,000,000 shares; none issued _ _
Common stock of $.01 par value; authorized
20,000,000 shares; issued 2,351,021
in 1994 and 1993 17 17
Additional paid-in capital 21,040 15,264
Accumulated deficit (21,961) (21,989)
Less: treasury stock (45,339 shares for 1994
and 1993) (280) (280)
--------- ---------
Total stockholders' deficit (1,184) (6,988)
--------- ---------
Total liabilities and stockholders' deficit $ 89,080 87,495
========= =========
See notes to unaudited consolidated financial statements.
BFC Financial Corporation and Subsidiaries
Consolidated Statements of Operations
For the three months ended March 31, 1994 and 1993
(in thousands, except per share data)
(Unaudited)
Three Months Ended March 31,
1994 1993
--------- ---------
Revenues:
Interest on loans $ 182 190
Interest and dividends on other investment
securities 206 73
Earnings on real estate operations, net 575 657
Other income, net 45 172
--------- ---------
Total revenues 1,008 1,092
--------- ---------
Cost and expenses:
Interest on exchange debentures 1,790 1,380
Interest on mortgages payable 689 766
Employee compensation and benefits 273 343
Occupancy and equipment 14 40
General and administrative 202 550
--------- ---------
Total cost and expenses 2,968 3,079
--------- ---------
(Loss) before equity in earnings of
BankAtlantic and cumulative
effect of change in accounting
for income taxes (1,960) (1,987)
Equity in earnings of BankAtlantic 1,988 2,019
--------- ---------
Income before cumulative effect of change
in accounting for income taxes 28 32
Cumulative effect of change in accounting
for income taxes - (501)
--------- ---------
Net income (loss) $ 28 (469)
========= =========
Earnings (loss) per share:
Net earnings (loss) before
cumulative effect of change
in accounting for income taxes $ 0.01 (0.08)
Cumulative effect of change
in accounting for income taxes - (0.29)
--------- ---------
Net earnings (loss) per share $ 0.01 (0.37)
========= =========
Weighted average number of shares
outstanding 2,056 1,702
========= =========
See notes to unaudited consolidated financial statements.
BFC Financial Corporation and Subsidiaries
Consolidated Statements of Stockholders' (Deficit)
For the three months ended March 31, 1994
(in thousands)
(unaudited)
Addi-
tional Accu- Trea-
Common Paid-in mulated sury
Stock Capital Deficit Stock Total
-------- -------- -------- -------- --------
Balance at December 31, 1993 17 15,264 (21,989) (280) (6,988)
Transfer from redeemable
common stock - 5,776 - - 5,776
Net income - - 28 - 28
-------- -------- -------- -------- --------
Balance at March 31, 1994 17 21,040 (21,961) (280) (1,184)
======== ======== ======== ======== ========
See notes to unaudited consolidated financial statements.
BFC Financial Corporation and Subsidiaries
Consolidated Statements of Cash Flows
For the three months ended March 31, 1994 and 1993
(in thousands)
(unaudited)
1994 1993
--------- ---------
Operating activities:
Income before cumulative effect of change
in accounting for income taxes $ 28 32
Adjustments to reconcile income
before cumulative effect of change in
accounting for income taxes to net cash
provided by operating activities:
Equity in earnings of BankAtlantic (1,988) (2,019)
Depreciation 442 403
Accretion on exchange debentures
and mortgage payables 28 94
Tax effect of real estate acquired
in debenture exchange (27) (31)
Amortization of discount on
loans receivable (18) (17)
Increase in deferred interest on the
exchange debentures 1,756 1,340
Increase in other liabilities 87 118
Decrease (increase) in other assets (115) 204
--------- ---------
Net cash provided by
operating activities 193 124
--------- ---------
Investing activities:
Common stock dividends received from
BankAtlantic 187 -
Decrease (increase) in other investment
securities (46) 83
Principal reduction on loans receivable 65 60
Additions to office
properties and equipment (12) (27)
Improvements to real estate acquired in
debenture exchanges (196) (50)
--------- ---------
Net cash (used) provided by investing
activities (2) 66
--------- ---------
Financing activities:
Repayments of borrowings (212) (228)
--------- ---------
Net cash (used) by financing activities (212) (228)
--------- ---------
(Decrease) in cash and cash equivalents (21) (38)
Cash at beginning of period 78 149
--------- ---------
Cash at end of period 57 111
========= =========
See notes to unaudited consolidated financial statements.
BFC Financial Corporation and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
March 31, 1994
1) PRESENTATION OF INTERIM FINANCIAL STATEMENTS
The accompanying unaudited consolidated financial statements have been
prepared by BFC Financial Corporation (the "Company" or "BFC") in accordance
with the accounting policies described in its 1993 Annual Report and should be
read in conjunction with the notes to the consolidated financial statements
which appear in that report. The Company became a savings bank holding company
in 1987 by acquiring shares of the common stock of BankAtlantic, A Federal
Savings Bank ("BankAtlantic"). The consolidated financial statements include
the accounts of BFC Financial Corporation and its wholly owned subsidiaries.
Because the Company's ownership in BankAtlantic is less than 50%, BankAtlantic
is carried on the equity method. All significant intercompany accounts and
transactions have been eliminated in consolidation.
In the opinion of management, the accompanying financial statements contain
such adjustments as are necessary to present fairly the Company's unaudited
consolidated financial condition at March 31, 1994, the unaudited consolidated
results of operations for the three months ended March 31, 1994 and 1993 the
unaudited consolidated cash flows for the three months ended March 31, 1994
and 1993. Such adjustments consisted only of normal recurring items. The
unaudited consolidated financial statements and related notes are presented as
permitted by Form 10-Q and consequently, do not include certain information
and notes necessary for a complete presentation of financial condition,
results of operations and cash flows as required by generally accepted
accounting principles for financial statements. The 1993 consolidated
financial statements have been reclassified to conform to the 1994
presentation.
(2) INVESTMENTS IN BANKATLANTIC AND OTHER ACQUISITIONS AND DISPOSITIONS
A reconciliation of the carrying value in BankAtlantic to BankAtlantic's
stockholders equity at March 31, 1994 and December 31, 1993 is as follows:
March 31, December 31,
1994 1993
---------- ---------
BankAtlantic Stockholders' equity $ 95,756 90,652
Net unrealized appreciation on mortgage-
backed securities available for sale-
net of deferred income taxes (1,457) -
Preferred stock (7,036) (7,036)
------- -------
BankAtlantic common stockholders' equity 87,263 83,616
Ownership percentage 48.17% 48.17%
------- -------
42,035 40,278
Purchase accounting adjustments (3,873) (3,842)
------- -------
Investment in BankAtlantic $ 38,162 36,436
======= =======
BFC also owns 5,600 shares of BankAtlantic 12.25% Series A Preferred Stock,
529 shares of BankAtlantic 10.00% Series B Preferred Stock and 4,636 shares of
BankAtlantic 8.00% Preferred Stock. The aggregate purchase price relating to
the acquisition of these shares was approximately $100,000 and is included in
trading securities, net in the accompanying statements of financial condition.
(3) EARNINGS (LOSS) PER COMMON SHARE
Earnings (loss) per common share for the period ended March 31, 1993 was
computed using the more dilutive of (a) the weighted average number of shares
outstanding, or (b) the weighted average number of shares outstanding assuming
that the shares of redeemable common stock are reacquired for debt, from the
later of their date of issuance (May 10, 1989) or the beginning of the
computation period, at the greater of the amount originally recorded, or the
then book value. Computation (b) was utilized, assuming a rate of 12% on
indebtedness for the three months ended March 31, 1993. In February 1994, the
parties mutually agreed to cancel the agreement with respect to the
requirement to buy and or sell shares. Therefore, during the first quarter of
1994, the amount classified as redeemable common stock was reclassified to the
stockholders' deficit section of the Statement of Financial Condition and
earnings per share was computed based upon the weighted average number of
shares outstanding. Shares issued in connection with a 1984 acquisition are
considered outstanding after elimination of 250,000 shares, representing the
Company's 50% ownership of the shares issued in the acquisition.
(4) INCOME TAXES
In February 1992, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes ("FAS
109"). FAS 109 requires a change from the deferred method to the asset and
liability method to account for income taxes. Under the asset and liability
method of FAS 109, deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled. Under
FAS 109, the effect of a change in tax rate on deferred tax assets and
liabilities is recognized in the period that includes the statutory enactment
date.
Pursuant to the deferred method under APB Opinion 11, which was applied in
1992 and prior years, deferred income taxes are recognized for income and
expense items that are reported in different years for financial reporting
purposes and income tax purposes using the tax rates applicable for the year
of the calculation. Under the deferred method, deferred taxes are not
adjusted for subsequent changes in tax rates.
BFC adopted FAS 109 as of January 1, 1993. The cumulative effect of this
change in accounting for income taxes was approximately $501,000 due to the
valuation allowance of mortgage-backed securities available for sale that were
held by BankAtlantic.
(5) CONSOLIDATED STATEMENTS OF CASH FLOWS
Other non-cash financing and investing activities for the three months ended
March 31, 1994 include: (i) the establishment of an escrow account to fund a
litigation settlement that transferred $12.5 million from other investment
securities to other assets, and (ii) the cancellation of a shareholder
agreement that resulted in the shift of $5,776,000 from redeemable common
stock to additional paid-in capital.
(6) OTHER ASSETS
Included in other assets at March 31, 1994 is $12.5 million that has been
placed in an escrow account in order to fund the settlement of litigation
against the Company arising from the Company's exchange of debentures for all
of the assets and liabilities of certain affiliated limited partnerships in
1991.
BFC Financial Corporation and Subsidiaries
Management's Discussion and Analysis of Results
of Operations and Financial Condition
General
- - -------
BFC Financial Corporation (the "Company" or "BFC") became a savings bank
holding company during 1987 by acquiring a controlling interest in
BankAtlantic, A Federal Savings Bank ("BankAtlantic"). At December 31, 1993
and March 31, 1994, the Company owned 48.17% of the outstanding common stock
of BankAtlantic.
Results of Operations
- - ---------------------
For the quarter ended March 31, 1994, the Company reported net income of
approximately $28,000 or $.01 per share as compared to a net loss of
approximately $469,000 or $.37 per share for the comparable period in 1993.
Operations for 1993 included a charge for the cumulative effect of a change in
accounting for income taxes from APB Opinion 11 to FAS 109, in the amount of
$501,000 or $.29 per share.
The decrease in revenues of approximately $84,000 for the three months ended
March 31, 1994 as compared with the same period in 1993 was primarily due to a
decrease in earnings on real estate operations of approximately $82,000 and a
reduction in other income, net of approximately $127,000, partially offset by
an increase in interest and dividends on other investment securities of
approximately $133,000.
Interest and dividends on other investment securities increased for the three
months ended March 31, 1994 as compared to the same period in 1993 primarily
due to an increase in investable funds, which resulted from the proceeds
received from the sale of BankAtlantic shares in November 1993.
Earnings on real estate operations, net decreased for the three months ended
March 31, 1994 as compared to the same period in 1993 primarily due to the
loss of a tenant that occupied approximately 81% of the leasable area at the
IBM Executive Office Building in Kingsport, Tennessee. This decrease was
partially offset by an increase in occupancy at other properties and a
decrease in operating expenses.
Other income, net decreased for the three months ended March 31, 1994 as
compared to the same period in 1993 primarily due to the origination fees
received in 1993 from an affiliate which did not recur in 1994.
The decrease in cost and expenses of approximately $111,000 for the three
months ended March 31, 1994 as compared to the same period in 1993 was
attributable to decreases in (i) interest on mortgages payable of
approximately $77,000, (ii) employee compensation and benefits of
approximately $70,000, (iii) occupancy and equipment of approximately $26,000
and (iv) general and administrative of approximately $348,000. This decrease
was offset by an increase in interest on exchange debentures of approximately
$410,000.
Interest on Exchange debentures for the three months ended March 31, 1994
increased as compared to the same period in 1993 due to the accrual of
interest on the previously deferred interest relating to the debentures issued
in the 1989 and 1991 exchange transactions and an increase in the interest
rate to the deferred payment rates of 13% and 12% for the debentures issued in
the 1991 and the 1989 exchanges, respectively.
Interest other on mortgages decreased for the three months ended March 31,
1994 as compared to the same period in 1993 due to the full amortization of
interest discount on a mortgage that matured in 1993.
Employee compensation and benefits decreased for the three months ended March
31, 1994 as compared to the comparable 1993 period primarily due to a
reduction in personnel in December 1993.
Occupancy and equipment decreased for the three months ended March 31, 1994 as
compared to the comparable 1993 period primarily due to the Company's
reduction in office space at its new location in Fort Lauderdale.
General and administrative expenses decreased for the three months ended March
31, 1994 as compared to the same period in 1993 primarily due to a decrease in
legal fees associated with the litigation which arose in connection with the
Company's exchange of debentures for all of the assets and liabilities of
certain affiliated limited partnerships in 1989 ("Exchange I") and with the
Company's exchange of debentures for all of the assets and liabilities of
certain affiliated limited partnerships in 1991 ("Exchange II").
BankAtlantic's net income for the quarter ended March 31, 1994 was $4.3
million compared to net income of $3.0 million for the quarter ended March 31,
1994. For the quarter ended March 31, 1994, the Company owned approximately
48.2% of the outstanding common stock of BankAtlantic whereas for the quarter
ended March 31, 1993, the Company owned 72.5% of the outstanding common stock
of BankAtlantic. The decline in the equity in earnings of BankAtlantic that
would have been reflected by the Company's decreased ownership was primarily
offset by increased earnings by BankAtlantic.
Financial Condition
- - -------------------
BFC's total assets at March 31, 1994 and at December 31, 1993 were $89 million
and $87.5 million, respectively. The majority of the difference at March 31,
1994 as compared to December 31, 1993 was primarily due to increases in other
assets and investment in BankAtlantic of approximately $12.6 million and $1.7
million, respectively, offset by a decrease in other investments of
approximately $12.4 million. The increase in other assets and decrease in
other investments at March 31, 1994 was attributable to the March 1994
transfer from other investments of $12.5 million to an escrow account to fund
the settlement of Exchange II litigation. Investment in BankAtlantic increased
by $1.7 million due to the equity in earnings of BankAtlantic for the quarter
ended March 31, 1994 and reduced by the common stock dividends declared on
March 1, 1994.
At March 31, 1994 deferred interest on the exchange debentures increased by
approximately $1.8 million due to interest deferred on Exchange I and Exchange
II debentures pursuant to their terms.
In May 1989, Mr. Abdo, currently a member of the Company's Board of Directors,
and certain members of his family (the "Abdos") were issued 353,478 shares of
the Company's authorized but unissued Common Stock pursuant to the terms of a
Stock Purchase Agreement with the Company pursuant to which the Company
acquired 282,782 shares of BankAtlantic, owned by the Abdo family. In
connection with the Stock Purchase Agreement, the Company, the Abdos and Mr.
Alan B. Levan, the President of the Company, entered into a Shareholders'
Agreement pursuant to which, among other things, the Abdos had the right to
require the Company to repurchase the shares of Common Stock in the Company
which they received for the higher of the book value or the average market
value (as defined) of the shares. Pursuant to the Shareholders' Agreement,
the Company and Mr. Levan had the right to require the Abdos to sell to either
of them such shares on the same terms. At the transaction date the book value
of the shares was greater than their market value. Accordingly, the amount
initially recorded for this redeemable common stock, $5,776,000, was at book
value. In February 1994, the parties mutually agreed to terminate the above
agreement. Therefore, during the first quarter of 1994, the amount classified
as redeemable common stock was reclassified to additional paid-in capital in
the statement of financial condition.
Liquidity and Capital Resources
- - --------------------------------
In connection with certain litigation related to Exchange I (See Item 3.
"Litigation", Timothy J. Chelling vs. BFC Financial Corporation, et.al. in the
Company's 1993 Annual Report), in December 1992, a jury found that BFC
Financial Corporation's issuance of debentures was unfair to investors. The
jury found that those limited partners who did not vote in favor of the
transaction are entitled to receive $8 million, rather than the approximately
$16 million of subordinated debentures which were issued to them as a
consequence of the Exchange. Based on the verdict, the Company would record a
pre-tax gain from the reduction of its debt of approximately $6 million, but
it nonetheless believes the verdict was not supported by the evidence at
trial. Accordingly, the Company has appealed the verdict and the gain is not
reflected in the financial statements. The court denied plaintiffs' motion
for prejudgment interest as to Series 21 and Series 23 and awarded prejudgment
interest to plaintiffs in Series 24 to be calculated to run from March 31,
1989 through December 18, 1992, the date of entry of final judgment, at the
rate of 3.54%. In connection with the stay of the judgment without a bond and
to secure the final judgment during the pendency of the appeal, BFC agreed to
place shares of the BankAtlantic Common Stock owned by it into an escrow or
collateral account for the benefit of the plaintiffs. Initially 800,000
shares have been delivered pursuant to the agreement but additional shares
will be delivered in the event that the market value of the 800,000 shares
delivered falls below $10 million.
In connection with other litigation against the Company relating to Exchange
II (See item 3. "Litigation ", Arthur Arrighi, et.al. and Shirley B. Daniels,
Robert and Ruby Avans, et.al. in the Company's 1993 Annual Report), on March
2, 1994, the parties entered into an agreement to settle these actions
pursuant to which BFC will pay approximately eighty-one percent (81%) of the
face amount of the outstanding debentures issued in connection with Exchange
II held by plaintiffs and the debentures subject to the settlement will be
canceled pursuant to the procedures outlined in the agreement. The settlement
is subject to, among other things, court approval. Upon effectiveness, the
settlement of this action will be dismissed with prejudice and the parties
will exchange releases. The Company, during March 1994 placed $12.5 million
in an escrow account to fund the settlement.
In connection with certain litigation related to the purchase and sale of an
apartment complex in Indiana (See item 3. "Litigation ", Short vs Eden
United, Inc., et.al. in the Company's 1993 Annual Report), on February 25,
1994, the court on remand awarded plaintiff a judgment totaling approximately
$4.5 million, including interest. The Company intends to appeal the trial
court's order and has posted an appeal bond. The bond is collateralized by
approximately $4.8 million of other investment securities. The Company had
accrued approximately $400,000 in prior years and based upon this order, at
December 31, 1993, accrued an additional $4.1 million for an aggregate $4.5
million provision for this litigation.
In addition to the litigation discussed above, an appellate court entered an
order reversing a lower court decision in favor of the Company and its
affiliates which related to the sale of units in two partnerships which
participated in Exchange II. (See Item 3. "Litigation", Martha Hess, et.al.
vs Gordon, Boula, et.al. in the Company's 1993 Annual Report.) The effect of
this decision, which the Company intends to appeal, is to create a potential
liability of approximately $1.8 million. Such amount was accrued at December
31, 1992. There is no requirement for a bond in connection with the appeal of
this matter.
The Company's ability to meet its obligations and to pay interest on the
debentures issued in Exchange I and Exchange II is substantially dependent on
the earnings and regulatory capital position of BankAtlantic. However,
pursuant to the terms of the debentures issued in Exchange I and Exchange II,
the Company may elect to defer interest payments on its subordinated
debentures if management of the Company determines in its discretion that the
payment of interest would impair the operations of the Company. Such deferral
does not create a default. Since December 31, 1991, the Company has deferred
interest payments amounting to approximately $13.8 million. The Company, not
considering BankAtlantic, has sufficient current liquidity to meet its normal
operating expenses, but it is not anticipated that it will make current
payments of interest on the Exchange debentures until at least such time as
the issues relating to the $8 million judgment discussed above and the other
litigation discussed in Item 3. "Litigation" in the Company's 1993 Annual
Report have been resolved.
Pursuant to an agreement entered into on May 10, 1989 between BFC, its
affiliates and BankAtlantic's primary regulator, BFC is obligated to infuse
additional capital into BankAtlantic in the event that BankAtlantic's net
capital (as defined) falls below the lesser of the industry's minimum capital
requirement (as defined) or six percent of BankAtlantic's assets. However,
there is no assurance that BFC will be in a position to infuse additional
capital in the event it is called upon to do so. This obligation will expire
ten years from the date of the agreement, or at such earlier time as
BankAtlantic's net capital exceeds its fully phased-in capital requirement (as
defined) for a period of two consecutive years. BankAtlantic's net capital
has exceeded its fully phased in capital requirements from the end of 1992
through March 31, 1994.
An OTS regulation, effective August 1, 1990, limits all capital distributions
made by savings institutions, including cash dividends, by permitting only
certain institutions that meet specified capital levels to make capital
distributions without prior OTS approval. The regulation established a three-
tiered system, with the greatest flexibility afforded to well-capitalized
institutions. An institution that meets all of its fully phased-in capital
requirements and is not in need of more than normal supervision would be a
"Tier 1 Institution". An institution that meets its minimum regulatory
capital requirements but does not meet its fully phased-in capital
requirements would be a "Tier 2 Institution". An institution that does not
meet all of its minimum regulatory capital requirements would be "Tier 3
Institution". A Tier 1 Institution may, after prior notice but without the
approval of the OTS, make capital distributions during a calendar year up to
100% of net income earned to date during the current calendar year plus 50% of
its capital surplus ("surplus" being the amount of capital over its fully
phased-in capital requirement). Any additional capital distributions would
require prior regulatory approval. A Tier 2 Institution may, after prior
notice but without the approval of the OTS, make capital distributions of
between 50% and 75% of its net income over the most recent four-quarter period
(less any dividends previously paid during such four-quarter period) depending
on how close the institution is to its fully phased-in risk-based capital
requirement. A Tier 3 Institution would not be authorized to make any capital
distributions without the prior approval of the OTS. Notwithstanding the
provision described above, the OTS also reserves the right to object to the
payment of a dividend on safety and soundness grounds. In August and December
1993, BankAtlantic declared cash dividends of $0.06 per share, payable
September 1993 and January 1994, respectively, to its common stockholders. A
15% common stock dividend was declared in May, 1993. In March 1994, the Board
of Directors declared a cash dividend of $0.06 per share, payable in April
1994 to its common stockholders.
Cash Flows
- - -----------
A summary of the Company's consolidated cash flows is as follows (in
thousands):
Three months ended
March 31,
-------------------
Net cash provided (used) by: 1994 1993
------ ------
Operating activities $ 193 124
Investing activities (2) 66
Financing activities (212) (228)
------ ------
Decrease in cash $ (21) (38)
====== ======
The changes in cash flow used or provided in operating activities are affected
by the changes in operations, which are discussed elsewhere herein, and by
certain other adjustments. These adjustments include additions to operating
cash flows for non-operating charges such as depreciation. Cash flow from
operating activities is also adjusted to reflect the use or the providing of
cash for increases and decreases, respectively, in operating assets, decreases
or increases, respectively of operating liabilities, and increases in exchange
debentures deferred interest. Accordingly, the changes in cash flow from
operating activities in the periods indicated above has been impacted not only
by the changes in operations during the periods but also by these other
adjustments.
The primary sources of funds to the Company, for the three months ended March
31, 1994 were revenues from property operations, collections on mortgage
receivables and the dividend from BankAtlantic. These funds were primarily
utilized for operating expenses at the properties, capital improvements at the
properties, mortgage payables on the properties and general and administrative
expenses.
PART II - OTHER INFORMATION
Item 1. Litigation
Cheryl and Wayne Hubbell, et al., vs. I.R.E. Advisors Series 26, Corp. et al.,
in the California Superior Court in Los Angeles, California, Case No.
BC049913. In May 1993, a motion to dismiss was filed by the plaintiffs to
dismiss all claims against all defendants relating to I.R.E. Real Estate Fund,
Ltd. - Series 25, I.R.E. Real Estate Fund, Ltd. - Series 27 and I.R.E. Real
Estate Income Fund, Ltd., whether exchange related or not. This motion is
scheduled to be heard by the Court on May 18, 1994.
Martha Hess, et. al., on behalf of themselves and all others similarly
situated, v. Gordon, Boula, Financial Concepts, Ltd., KFB Securities, Inc., et
al. In March 1994, plaintiffs amended their complaints for rescission to
reassert the class allegations through new class representatives and to
request attorneys' fees.
Short vs. Eden United, Inc., et al. in the Marion County Superior Court, State
of Indiana. Civil Division Case No. S382 0011. In April 1994, BFC Financial
Corporation posted a $4.8 million appeal bond with respect to the appeal in
this case. Such bond is collateralized by approximately $4.8 million of other
investment securities owned by the Company.
Item 2 through 5.
Not applicable.
Item 6. Exhibits and Reports on Form 8-K
a) No exhibits have been attached hereto.
b) No report on Form 8-K was filed during the quarter ended March 31, 1994.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BFC Financial Corporation
Date: May 13, 1994 By: /s/ Glen R. Gilbert
------------------------------------
Glen R. Gilbert, Senior Vice President
and Chief Financial Officer
