-SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
BFC FINANCIAL CORPORATION
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on the table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
BFC Financial Corporation
P.O. Box 5403
Fort Lauderdale, FL 33310-5403
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on July 30, 1998
Fort Lauderdale, Florida
July 9, 1998
To the Stockholders of BFC Financial Corporation:
The Annual Meeting of Stockholders of BFC Financial Corporation (the "Company")
will be held at the Westin Hotel Fort Lauderdale, 400 Corporate Drive (I-95 and
Cypress Creek Road), Fort Lauderdale, FL 33334, on Thursday, July 30, 1998, at
9:30 AM local time for the following purposes:
1. To elect one member to the Board of Directors for a term of three
years;
2. To transact such other business as may properly come before the
Annual Meeting or any adjournment or postponement thereof,
including any matters relating or incident to the foregoing.
The foregoing matters are described in more detail in the Proxy Statement which
forms a part of this Notice.
Only stockholders of record of Class B Common Stock at the close of business on
July 9, 1998 are entitled to notice of and to vote at the Annual Meeting. Class
A Common Stockholders will not be entitled to vote at this meeting,
Enclosed for your review and consideration is a proxy statement in connection
with the solicitation of proxies on behalf of the Board of Directors of the
Company for use at the Annual Meeting of Stockholders. You are urged to read the
proxy statement carefully. YOUR VOTE IS IMPORTANT.
Whether or not you expect to attend the meeting in person, please mark, sign and
return the accompanying proxy card in the enclosed envelope. If you later desire
to revoke your proxy, you may do so at any time prior to its exercise by giving
written notice to the Secretary of the Company, by execution of a subsequent
dated proxy or by personally attending and voting at the Annual Meeting. Any
proxy which is not revoked will be voted at the meeting as directed in the
proxy, or, where no direction is given, the proxy will be voted in accordance
with the recommendations of the Board of Directors.
Sincerely,
/S/ Glen R. Gilbert
-------------------
Glen R. Gilbert
Secretary
<PAGE>
BFC Financial Corporation
P.O. Box 5403
Fort Lauderdale, FL 33310-5403
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of proxies
to be used at the 1998 Annual Meeting of Stockholders (the "Annual Meeting") of
BFC Financial Corporation (the "Company") to be held on Thursday, July 30, 1998
commencing at 9:30 AM, local time, at the Westin Hotel Fort Lauderdale, 400
Corporate Drive (I-95 and Cypress Creek Road), Fort Lauderdale, FL 33334, and
any adjournment thereof for the purposes set forth in the accompanying Notice of
Meeting.
This solicitation of proxies is made on behalf of the Board of Directors of BFC
Financial Corporation.
Each proxy solicited hereby, if properly executed and received by BFC Financial
Corporation prior to the Annual Meeting and not revoked prior to its use, will
be voted in accordance with the instructions contained therein. Executed proxies
with no instructions contained therein will be voted for the election of the
nominees as directors described below. Although the Board of Directors is
unaware of any matters to be presented at the Annual Meeting other than matters
disclosed herein, if any other matters are properly brought before the Annual
Meeting, the persons named in the enclosed form of proxy will vote as proxies in
accordance with their own best judgment on those matters.
Only holders of the Company's Class B Common Stock will be entitled to vote at
the Annual Meeting.
Any stockholder signing and returning a proxy on the enclosed form has the power
to revoke it at any time before it is exercised by notifying the Secretary of
the Company in writing at the address set forth above, by submitting a duly
executed proxy bearing a later date or by attending the Annual Meeting and
voting in person.
Record Date; Stockholders' Entitled to Vote
Only stockholders of record of BFC Financial Corporation Class B Common Stock,
$0.01 par value per share ("Class B Common Stock"), at the close of business on
July 9, 1998 are entitled to vote at the Annual Meeting. On that day, there were
issued and outstanding 2,348,907 shares of Common Stock. The Class B Common
Stock constitutes the only class of capital stock of the Company entitled to
vote at the Annual Meeting. Holders of the Company's Class A Common Stock are
not entitled to vote on any of the matters to be submitted for a vote at the
Annual Meeting. Each Class B Common Stockholder is entitled to one vote for each
share of Class B Common Stock share held. See "Quorum and Required Vote" and
"Security Ownership Of Certain Beneficial Owners And Management".
Quorum and Required Vote
A majority of the outstanding shares of Class B Common Stock, represented in
person or by proxy, constitutes a quorum for the transaction of business at the
Annual Meeting. In the event that there are not sufficient shares represented
for a quorum, the Annual Meeting may be adjourned from time to time until a
quorum is obtained.
Vote Required for Approval
The election of directors will require the affirmative vote of a plurality of
the shares of Class B Common Stock voting in person or by proxy at the Annual
Meeting; accordingly, votes that are withheld and broker non-votes will not
affect the outcome of the election.
Security Ownership Of Certain Beneficial Owners And Management
Listed in the table below are the beneficial owners known by the Company to hold
as of June 18, 1998 more than 5% of the Company's outstanding Common Stock. In
addition, this table includes the outstanding securities beneficially owned by
the executive officers and directors and the number of shares owned by directors
and executive officers as a group.
<TABLE>
<CAPTION>
Class A Class B
Common Stock Common Stock
Ownership Ownership Percent of Percent of
as of as of Class A Class B
Name of Beneficial Owner June 18, 1998 June 18, 1998 Common Stock Common Stock
- ------------------------ ------------- ------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
I.R.E. Realty Advisory Group, Inc. (2)(5) 1,375,000 500,000 21.30% 10.44%
I.R.E. Properties, Inc. (5) 375,832 136,666 5.82% 2.85%
I.R.E. Realty Advisors, Inc. (5) 666,108 242,221 10.32% 5.06%
Florida Partners, Corporation (5) 366,614 133,314 5.68% 2.78%
Alan B. Levan (1)(3)(5) 156,929 1,139,972 2.43% 23.80%
John E. Abdo (1)(5) 1,019,563 1,163,478 15.80% 24.29%
Dr. Herbert A. Wertheim (4) 1,145,232 416,448 17.74% 8.69%
Glen R. Gilbert (1)(5) 2,690 96,603 0.04% 2.02%
Earl Pertnoy (1)(5) 18,975 53,478 0.29% 1.12%
Carl E.B. McKenry, Jr (1)(5) 688 48,978 0.01% 1.02%
All directors and executive officers
of the Company as a group
(5 persons) (1)(2) 3,982,399 3,514,710 61.70% 73.37%
</TABLE>
~~~~~~~~~~~~~~~~~~~~~~
(1) The above ownership amounts and nature of beneficial ownership and
percent of class include shares that may be acquired within 60 days
pursuant outstanding stock options to purchase Class B Common Stock as
follows:
Number of
Name Shares
---- ------
Alan B. Levan 1,082,907
John E. Abdo 1,162,500
Glen R. Gilbert 95,625
Earl Pertnoy 52,500
Carl E.B. McKenry 48,000
---------
Total 2,441,532
=========
(2) BFC owns 45.5% of I.R.E. Realty Advisory Group, Inc.
(3) Alan B. Levan is a controlling and majority shareholder of the corporate
general partner of a family limited partnership that owns 153,629 shares
of Class A Common Stock and 55,865 shares of Class B Common Stock. The
family limited partnership is a controlling and majority shareholder of
I.R.E. Realty Advisors, Inc., I.R.E. Properties, Inc. and may be deemed
to be the controlling shareholder of I.R.E. Realty Advisory Group, Inc.
and Florida Partners Corporation and therefore may be deemed to be the
beneficial owner of the shares of Common Stock owned by such entities.
Additionally, included above is 3,300 shares of Class A Common Stock and
1,200 shares of Class B Common Stock held of record by Mr. Levan's wife.
Alan B. Levan, therefore, may be deemed to have an aggregate beneficial
ownership of 2,940,483 shares of Class A Common Stock (45.56%) and
2,152,173 shares of Class B Common Stock (44.93%).
(4) Dr. Wertheim's ownership was reported in a Rebuttal of Control Agreement
filed on December 20, 1996 with the Office of Thrift Supervision (as
adjusted for stock splits since the date of filing). The Rebuttal of
Control Agreement indicates that Dr. Wertheim has no intention to manage
or control, directly or indirectly, BFC Financial Corporation. Dr.
Wertheim's mailing address is 191 Leucadendra Drive, Coral Gables,
Florida 33156.
(5) The mailing address is 1750 East Sunrise Boulevard, Fort Lauderdale,
Florida 33304.
BFC knows of no other persons who beneficially own 5% or more of its outstanding
Common Stock.
ELECTION OF DIRECTORS
The bylaws of BFC Financial Corporation provide that the Board of Directors
shall consist of not less than three nor more than twelve members divided into
three classes. The Board currently consists of four members. The term of one
director expires at the Annual Meeting and it is therefore necessary to elect a
director to fill such vacancy to serve for a three year term, or until his
respective successor has been elected and qualified. The Board of Directors has
nominated Alan B. Levan to serve as director in the class whose term expires at
the 2001 Annual Meeting of Shareholders. The nominee is currently a member of
the Company's Board of Directors.
There are no arrangements or understandings between the Company and any person
pursuant to which such person has been or will be elected a director and there
are no familial relationships between any director or officer of the Company.
Unless otherwise directed, each proxy executed and returned by a stockholder
will be voted for the election of the nominee shown below.
Board Of Directors
The following information is provided for each of the Company's current
directors.
Name Age Director Since Term Expires
---------------------- --- -------------- ------------
Alan B. Levan 53 1978 1998
Earl Pertnoy 72 1978 1999
Carl E. B. McKenry, Jr. 69 1981 2000
John E. Abdo 54 1988 1999
All Directors are to serve until the election and qualification of their
respective successors.
The principal occupation and certain other information with respect to each
director, including the nominee are set forth below.
Nominee To Serve Three-Year Term Expiring At The 2001 Annual Meeting
ALAN B. LEVAN formed the I.R.E. Group (predecessor companies to BFC Financial
Corporation) in 1972. Since 1978, he has been the Chairman of the Board,
President, and Chief Executive Officer of BFC Financial Corporation or its
predecessors. He is Chairman of the Board and President of I.R.E. Realty
Advisors, Inc., I.R.E. Properties, Inc., I.R.E. Realty Advisory Group, Inc.,
U.S. Capital Securities, Inc., and Florida Partners Corporation. He is
President, Chairman of the Board and Chief Executive Officer of BankAtlantic
Bancorp, Inc. ("BBC"), the holding company for BankAtlantic, A Federal Savings
Bank ("BankAtlantic") and BankAtlantic. He is an individual general partner and
an officer and a director of the corporate general partner of a public limited
partnership which is affiliated with BFC Financial Corporation.
Director Serving Three-Year Term Expiring At The 2000 Annual Meeting
CARL E. B. McKENRY, JR. is the Director of the Small Business Institute at the
University of Miami in Coral Gables, Florida. He has been associated in various
capacities with the University since 1955. He has been a director of BFC
Financial Corporation since 1981 and is also a director of the corporate general
partner of an affiliated public limited partnership.
Directors Serving Three-Year Terms Expiring At The 1999 Annual Meeting
EARL PERTNOY has been for more than the past five years a real estate investor
and developer. He has been a director of BFC Financial Corporation and its
predecessor companies since 1978 and is also a director of the corporate general
partner of an affiliated public limited partnership.
JOHN E. ABDO is the President and Chief Executive Officer of The Abdo Companies,
Inc., a real estate development, construction and brokerage firm, for more than
five years. He has been Vice Chairman of the Board of BFC Financial Corporation
since 1993. He has been a director of BankAtlantic since 1984, Chairman of the
Executive Committee of BankAtlantic since October 1985 and Vice Chairman of the
Board of BankAtlantic since April 1987. In 1994, he became a director of BBC. He
is also a Director of Benihana National Corporation, a national restaurant
chain, and Chairman of the Board of Coconut Code, Inc., a software company.
Meetings And Committees Of The Board Of Directors
During 1997, the Board of Directors held eleven meetings. No director attended
fewer than seventy-five percent (75%) of the total number of meetings of the
Board of Directors or the committees on which such Board member served during
this period.
The members of the Audit Committee are Dr. Carl E. B. McKenry, Jr. and Earl
Pertnoy. The Audit Committee meets as needed but no less frequently than
annually to consider the findings of BFC Financial Corporation's independent
auditors and to evaluate policies and procedures relating to internal controls.
The Audit Committee held four meetings during the year ended December 31, 1997.
The members of the Compensation Committee are Dr. Carl E. B. McKenry, Jr. and
Earl Pertnoy. The Compensation Committee held one meeting during 1997. The
primary purpose of the Compensation Committee is to establish and implement
compensation policy and programs for BFC Financial Corporation executives. The
Compensation Committee also recommends the compensation arrangements for
executive officers and directors. It also serves as the Stock Option Committee
for the purpose of determining incentive stock options to be granted under the
BFC Financial Corporation Stock Option Plan.
The Board of Directors has no standing nominating committee.
Compensation Of Directors
Members of the Board of Directors of the Company who are not employees of the
Company receive $1,750 per month for serving on the Company's Board.
Additionally, members of the Audit Committee receive a fee of $1,000 per Audit
Committee meeting attended. Other than such compensation, there are no other
arrangements pursuant to which any director is compensated for his services as
such.
Identification And Background Of Executive Officers And Certain Significant
Employees
The Executive Officers of the Company are as follows:
Name Age Position
---- --- --------
Alan B. Levan 53 President, Chairman of the Board, Director
Glen R. Gilbert 53 Executive Vice President, Chief Financial Officer
and Secretary
The following persons are executive officers of BFC Financial Corporation's
principal subsidiary, BBC. Positions indicated are those held at BBC.
Name Age Position at BBC
---- --- ---------------
Alan B. Levan 53 Director, Chairman of the Board and Chief
Executive Officer
John E. Abdo 54 Director, Vice Chairman of the Board
Frank V. Grieco 54 Senior Executive Vice President
Jasper Eanes 53 Executive Vice President, Chief Financial Officer
All such officers will serve until they resign or are replaced by the Board of
Directors.
Background Of Executive Officers
ALAN B. LEVAN - See "Election Of Directors".
GLEN R. GILBERT has been Executive Vice President of BFC Financial Corporation
since July 1997. Prior to that date he served in the position of Senior Vice
President of BFC Financial Corporation. In May 1987, he was appointed Chief
Financial Officer and in October 1988, was appointed Secretary. He joined the
Company in November 1980 as Vice President and Chief Accountant. He has been a
certified public accountant since 1970. He serves as an officer of Florida
Partners Corporation and of the corporate general partner of an affiliated
public limited partnership. He has been Vice President and a director of
BankAtlantic Development Corporation, a wholly-owned subsidiary of BankAtlantic,
since 1997.
The principal occupation and certain other information with respect to the
executive officers of BBC is set forth below.
ALAN B. LEVAN - See "Election Of Directors".
JOHN E. ABDO - See "Election Of Directors".
JASPER R. EANES joined BankAtlantic in January 1989 as Senior Vice President,
Director of Internal Auditing and became Executive Vice President, Chief
Financial Officer in August 1989. In 1994, he became Executive Vice President,
Chief Financial Officer of BBC.
FRANK V. GRIECO joined BankAtlantic in April 1991 as Senior Executive Vice
President. In 1994, he became Senior Executive Vice President of BBC. He served
as a director of BankAtlantic from 1991 to May 1998 and as director of BBC from
1994 to June 1998.
Executive Compensation
The following table and the notes thereto set forth information with respect to
the annual compensation paid by the Company and its subsidiaries, excluding BBC
and its subsidiaries, for services rendered in all capacities during the year
ended December 31, 1997 to each of the executive officers of the Company as well
as total annual compensation paid to each of those individuals for the prior two
years.
<PAGE>
<TABLE>
<CAPTION>
Long-Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- ------ -------
Other Restricted Stock All
Name and Annual Stock Options Other
Principal Compen- Awards(s) Awarded LTIP Compen-
Position Year Salary Bonus sation ($) (#)(3) Payouts sation(2)
-------- ---- ------ ----- ------ --- ------ ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Alan B. Levan(1) 1997 $ 509,910 -- -- -- 375,000 1,628 80,495
Chairman of the Board, 1996 508,176 -- -- -- -- 1,662 80,774
President and Chief 1995 315,000 180,500 -- -- 375,000 1,634 92,709
Executive Officer
Glen R. Gilbert 1997 210,625 8,070 -- -- 93,750 1,628 --
Senior Vice President, 1996 209,817 7,760 -- -- -- 1,662 --
Chief Financial Officer 1995 199,827 16,066 -- -- 37,500 1,634 --
and Secretary
</TABLE>
~~~~~~~~~~~
(1) Excludes salary, bonuses and other compensation, respectively, paid by
BankAtlantic in the amount of $350,574, $0 and$156,432 for 1997,
$321,168, $193,740 and $158,045 for 1996; and $313,080, $0 and $900 for
1995. No amounts were paid to Mr. Levan by BBC.
(2) Represents reimbursements or payments for life and disability insurance.
(3) The number of options has been adjusted to reflect stock splits effected
after grant date.
The foregoing table includes only executive officers of BFC and does not include
executive officers of BBC or BankAtlantic. With the exception of Mr. Levan,
executive officers of BBC and BankAtlantic do not have significant executive
responsibilities with respect to key policy decisions of BFC.
Options/SAR Grants Table
The following table sets forth information concerning individual grants of stock
options to the named executives in the Summary Compensation Table pursuant to
BFC's Stock Option Plan during the year ended December 31, 1997. BFC has not
granted and does not currently grant stock appreciation rights.
<TABLE>
<CAPTION>
Individual Grants
------------------------------------------------------
Potential Realizable
Value at Assumed
Number of % of Annual Rates of
Securities Total Options Stock Price
Underlying Granted to Exercise Appreciation for
Options Employees in Price Per Expiration Option Term (2)
Name Granted (1) Fiscal Year Share Date 5% ($) 10% ($)
- ---- ----------- ----------- ----- ---- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
Alan B. Levan 375,000 40.82% $ 4.47 7/1/2007 $1,053,400 $2,669,534
Glen R. Gilbert 93,750 10.20% $ 4.07 7/1/2007 $ 239,766 $ 607,617
</TABLE>
~~~~~~~~~~
(1) Options vest 50% on January 1, 1998 and 50% on January 1, 1999. All
option grants are in Class B Common Stock.
(2) Amounts for the named executive have been calculated by multiplying the
exercise price by the annual appreciation rate shown (compounded for the
remaining term of the options), subtracting the exercise price per share
and multiplying the gain per share by the number of shares covered by the
options. The dollar amounts under these columns are the result of
calculations based upon assumed rates of annual compounded stock price
appreciation specified by regulation and are not intended to forecast
actual future appreciation rates of the Company's stock price.
Aggregated Option/SAR Exercises And Fiscal Year End Option/SAR Value Table
The following table sets forth as to each of the named executive officers
information with respect to the number of shares of Class B Common Stock
acquired upon exercise of options during 1997 and underlying unexercised options
at December 31, 1997. BFC has not granted and does not currently grant stock
appreciation rights.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Number of Value Underlying Unexercised In-The-Money Options
Shares Realized Options at 12/31/97 On 12/31/97 (1)
Acquired or Upon ---------------------- --------------------
Name Exercised Exercise Exercisable Unexercisable Exercisable Unexercisable
- ---- --------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Alan B. Levan 34,596 $ 78,767 670,407 375,000 $ 5,972,182 $ 2,145,225
Glen R. Gilbert 37,500 $ 90,000 18,750 93,750 $ 169,760 $ 573,805
</TABLE>
(1) Based upon the average of the last bid and the last ask as reported by
the National Quotation Bureau for the last trading day of 1997 which was
$10.625.
Long-Term Incentive Plan ("LTIP") Awards Table
BFC has made available a profit-sharing plan to all BFC employees (which does
not include BBC employees) who meet certain minimum requirements. BFC is not
required to make any contribution and the amount of BFC's contribution is
determined each year by the Board of Directors. It requires a uniform allocation
to each employee of 0% to 15% of compensation (with the maximum compensation
considered being $50,000). Vesting is in increments over a 7-year period to
100%. Alan B. Levan and Glen R. Gilbert are 100% vested.
Estimated Future Payouts
Under Non-Stock
Performance Period Price-Based Plans
Amount of Until Maturation Threshold, Target
Name Award or Payment and Maximum
---- ----- ---------- -----------
Alan B. Levan $ 1,628 100% vested $96,375
Glen R. Gilbert $ 1,628 100% vested $74,628
Stock Performance Graph And Compensation Committee Report
Notwithstanding contrary statements set forth in any of the Company's previous
filings under the Securities Act of 1933 or the Securities Exchange Act of 1934
that might incorporate future filings, including this proxy statement, the Stock
Performance Graph and the Compensation Committee Report set forth below shall
not be incorporated by reference into such filings.
Stock Performance Graph
The following graph provides an indicator of cumulative total stockholder
returns for the Company as compared with the Total Return Index for the NASDAQ
Stock Market (U.S. companies) and Total Return Index for the NASDAQ Financial
Stocks:
[CHART OMMITTED FROM ELECTRONIC FILING]
Year Ended December 31,
-----------------------
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
BFC Financial Corporation 100 225 213 403 688 1,910
Nasdaq Stock Market 100 115 112 159 195 240
Nasdaq Financial Stocks 100 116 117 170 218 334
*Assumes $100 invested on December 31, 1992.
Compensation Committee Report
Directors McKenry and Pertnoy have been designated by the Board of Directors to
serve on the Compensation Committee. The Compensation Committee has provided the
following report on executive compensation.
Executive Officer Compensation
The Compensation Committee of BFC Financial Corporation met to consider the
appropriate compensation package to recommend to the Board of Directors for the
Chairman and President, Alan B. Levan. From the meeting the following elements
have been developed:
Executive Compensation Policy - BFC Financial Corporation's overall compensation
philosophy is to retain quality personnel, which is critical to both the
short-term and long-term success of BFC Financial Corporation. In order to
implement that philosophy BFC Financial Corporation's approach to base
compensation is to offer competitive salaries in comparison to market practices.
Compensation History - Compensation to executive officers in mid 1991 was
voluntarily reduced based on the Company's transition from the real estate
syndication business to a savings bank holding company and the losses incurred
by the Company's savings bank subsidiaries as it shifted its activities from
those of a traditional thrift to those more closely related to commercial
banking. During 1995, with the return of profitability at the savings bank
subsidiary, compensation was returned to pre-1991 levels.
General - During 1997 total compensation for all executives, including the
President, was maintained at the 1995 and 1996 levels. In deciding to maintain
this base compensation, market compensation levels and trends in the labor
market were considered and available market information was used as a frame of
reference for annual salary adjustments.
Stock Options -Stock options were granted to executive officers during 1997. All
of the stock options were granted with an exercise price equal to at least 100%
of the market values of the BFC Financial Corporation Class B Common Stock on
the date of the grant. As such, the stock options only have value if the value
of BFC Financial Corporation Class B Common Stock increases. The granting of
options is totally discretionary and options are awarded based on an assessment
of an employee's contribution to the success and growth of the Company. Grants
of stock options are based on the level of an executive's position with the
company, and evaluation of the executive's past and expected performance, the
number of outstanding and previously granted options and discussions with the
executive. The Committee believes that granting of stock options as a part of
executive compensation more closely aligns the executives' interests with those
of BFC Financial Corporation stockholders, since the ultimate value of such
compensation is directly dependent on the stock price.
CEO Compensation - In evaluating the performance of the Chief Executive, Mr.
Levan, the committee considered BFC Financial Corporation's net worth, earnings
and stock price. The Committee also considered that Mr. Levan spends
considerable effort and attention in connection with the operations of
BankAtlantic and that the performance of BankAtlantic has been a substantial
factor in the success of BFC Financial Corporation.
1993 OBRA - Executive Compensation Tax Deductibility. The Omnibus Budget
Reduction Act ("OBRA") of 1993 included a provision which eliminates a company's
tax deduction for any compensation over one million dollars paid to any one of
the executives who appear in the Summary Compensation Table, subject to several
statutory exceptions. The Committee does not anticipate additional tax exposure
based on the Company's current executive compensation program.
The above report was submitted by Earl Pertnoy and Carl E. B. McKenry.
Certain Relationships And Related Transactions
Certain Business Relationships
Alan B. Levan, the President and a director of the Company, is also President
and a director of I.R.E. Properties, Inc., I.R.E. Realty Advisory Group, Inc.,
I.R.E. Realty Advisors, Inc. and Florida Partners Corporation. Mr. Levan is also
Chairman of the Board and Chief Executive Officer of BBC and BankAtlantic. Mr.
Levan is also a shareholder of I.R.E. Properties, Inc. and I.R.E. Advisors, Inc.
and may be deemed a controlling shareholder of the Company. Mr. Levan, Earl
Pertnoy and Carl McKenry serve on the Board of Directors of managing general
partners of affiliated public limited partnerships. John E. Abdo, a director of
the Company, is Vice Chairman of the Board of BBC and BankAtlantic.
Management believes that all transactions between the Company and its affiliates
were on terms at least as favorable as could have been obtained from
unaffiliated third parties.
In 1994, the Company agreed to participate in certain real estate opportunities
with John E. Abdo, Vice Chairman of the Board, and certain of his affiliates
(the "Abdo Group"). Under the arrangement, the Company and the Abdo Group will
share equally in profits after any profit participation due to any other
partners in the ventures and after a priority return in favor of the Company.
The Company bears the risk of loss, if any, under the arrangement. On such
basis, the Company acquired from an unaffiliated seller 60.1 acres of unimproved
land known as the "Center Port" property in Pompano Beach, Florida. The property
is currently being marketed for sale and serves as partial collateral for a loan
to the Company from an unaffiliated lender.
Appointment Of Independent Auditors
The Board of Directors has reappointed KPMG Peat Marwick, LLP as independent
auditors to audit the financial statements of BFC Financial Corporation for the
current fiscal year. Representatives of the firm of KPMG Peat Marwick, LLP are
expected to be present at the Annual Meeting and will have an opportunity to
make a statement if they so desire and will be available to respond to
appropriate questions.
Other Information
Stockholders' Proposals For Next Annual Meeting
Stockholders' proposals intended to be presented at the 1999 Annual Meeting must
be received by BFC Financial Corporation no later than March 1, 1999, for
inclusion in BFC Financial Corporation's proxy statement and form of proxy for
that meeting.
Expenses Of Solicitation
The cost of preparing, assembling, and mailing the proxy material and of
reimbursing brokers, nominees, and fiduciaries for the out-of-pocket and
clerical expenses of transmitting copies of the proxy material to the beneficial
owners of shares held of record by such persons will be borne by BFC Financial
Corporation. BFC Financial Corporation does not intend to solicit proxies
otherwise than by use of the mail, but certain officers and regular employees of
BFC Financial Corporation without additional compensation, may use their
personal efforts, by telephone or otherwise, to obtain proxies. The proxy
materials are being mailed to stockholders of record at the close of business on
July 9, 1998.
Other Business
The Board of Directors of the Company does not know of any other matters that
are to be presented for action at the meeting. Should any other matter come
before the meeting, however, the persons named in the enclosed Proxy shall have
discretionary authority to vote all shares represented by valid proxies with
respect to such matter in accordance with their judgment.
* * * * * * * * * * * * * * * * * * * * * * * * * * *
By Order of the Board of Directors
/S/ Glen R. Gilbert
Glen R. Gilbert
Secretary
July 9, 1998
A COPY OF THE FORM 10-K AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
WILL BE FURNISHED WITHOUT CHARGE TO BENEFICIAL OWNERS OF THE COMPANY'S COMMON
STOCK AS OF THE RECORD DATE UPON WRITTEN REQUEST TO GLEN R. GILBERT, SECRETARY,
BFC FINANCIAL CORPORATION, P.O. BOX 5403, FORT LAUDERDALE, FL 33310-5403.
<PAGE>
Appendix - Form of Proxy
REVOCABLE PROXY
BFC FINANCIAL CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
Proxy Solicited On Behalf of the Board of Directors
The undersigned hereby appoints Glen R. Gilbert and Lourdes G. Lastres, or
either of them, the undersigned's proxies, with full power of substitution, to
vote all of the shares of Class B Common Stock of BFC FINANCIAL CORPORATION (the
"Company") which the undersigned would be entitled to vote if personally present
at the Annual Meeting of Stockholders to be held at the Westin Hotel Fort
Lauderdale, 400 Corporate Drive, Fort Lauderdale, FL 33334, on July 30, 1998, at
9:30 AM local time, and at any adjournment or postponement thereof, as
hereinafter specified upon the proposals listed below and as more particularly
described in the Company's Proxy Statement, receipt of which is hereby
acknowledged, and in their discretion, upon such other business as may properly
come before such Annual Meeting or adjournments or postponements thereof.
This Proxy will be voted in accordance with the instructions set forth herein,
or in the event no instructions are set forth, this Proxy will be voted FOR the
nominee set forth on the back of this card and described in the accompanying
Notice of Annual Meeting and Proxy Statement. This Proxy hereby revokes all
prior proxies given with respect to the shares of the undersigned.
(Continued, and to be signed and dated on the other side.)
Election of a director to serve a three year term to expire in 2001.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEE NAMED BELOW:
Nominee: Alan B. Levan
FOR the nominee WITHHOLD AUTHORITY
listed above to vote for the
nominee listed above.
[ ] [ ]
Please mark, sign, date and return this proxy card
promptly, using the enclosed envelope. No Postage is
required for mailing it in the United States.
Dated: ______________, 1998
--------------------------
(Signature of Stockholder)
--------------------------
(Signature of Stockholder)
IMPORTANT: Please sign exactly as name(s) appear(s)
at left. When signing as attorney, executor,
administrator, trustee, guardian, please give full
title as such. If a corporation, please sign the
full corporate name by President or other authorized
officer. If a partnership, please sign in
partnership name by authorized person.
