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0001193125-13-143984.txt : 20130405 0001193125-13-143984.hdr.sgml : 20130405 20130405161557 ACCESSION NUMBER: 0001193125-13-143984 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20130402 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Completion of Acquisition or Disposition of Assets ITEM INFORMATION: Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant ITEM INFORMATION: Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers: Compensatory Arrangements of Certain Officers ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20130405 DATE AS OF CHANGE: 20130405 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BBX CAPITAL CORP CENTRAL INDEX KEY: 0000921768 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 650507804 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13133 FILM NUMBER: 13746099 BUSINESS ADDRESS: STREET 1: 401 EAST LAS OLAS BLVD STREET 2: SUITE 800 CITY: FORT LAUDERDALE STATE: FL ZIP: 33301 BUSINESS PHONE: 954-940-4000 MAIL ADDRESS: STREET 1: P. O. BOX 39001 CITY: FORT LAUDERDALE STATE: FL ZIP: 33303 FORMER COMPANY: FORMER CONFORMED NAME: BBX CAPITAL Corp DATE OF NAME CHANGE: 20120806 FORMER COMPANY: FORMER CONFORMED NAME: BANKATLANTIC BANCORP INC DATE OF NAME CHANGE: 19940418 8-K 1 d516900d8k.htm 8-K 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 2, 2013

BBX CAPITAL CORPORATION

(Exact name of registrant as specified in its charter)

Florida

001-13133

65-0507804

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)


401 East Las Olas Boulevard, Suite 800, Fort Lauderdale, Florida		33301
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: 954-940-4000

Not applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

The information set forth in Item 2.01 below relating to the Agreement (as hereinafter defined), the Note (as hereinafter defined) and the Amended and Restated Operating Agreement of Woodbridge Holdings, LLC (“Woodbridge”), as well as the copies of such documents which are filed as Exhibits 2.1, 10.1 and 10.2, respectively, to this Current Report on Form 8-K, are incorporated into this Item 1.01 by reference.

Item 2.01 Completion of Acquisition or Disposition of Assets.

On April 2, 2013, BBX Capital Corporation (the “Company”) entered into a Purchase Agreement (the “Agreement”) with Woodbridge and BFC Financial Corporation (“BFC”). Under the terms of the Agreement, the Company agreed to invest $71.75 million in Woodbridge in exchange for a 46% equity interest in Woodbridge. The investment was contemplated by the parties in connection with the financing of, and was conditioned upon the consummation of, Woodbridge’s acquisition of Bluegreen Corporation (“Bluegreen”) pursuant to the Agreement and Plan of Merger, dated as of November 14, 2012, by and among BFC, Woodbridge, BXG Florida Corporation and Bluegreen.

On April 2, 2013, the Company consummated its investment in Woodbridge in connection with the completion of Woodbridge’s acquisition of Bluegreen (the “Merger”). As described above, pursuant to the terms of the Agreement, the Company invested $71.75 million in Woodbridge contemporaneously with the closing of the Merger in exchange for a 46% equity interest in Woodbridge. BFC holds the remaining 54% of Woodbridge’s outstanding equity interests. The Company’s investment in Woodbridge consisted of $60 million in cash and a promissory note in Woodbridge’s favor in the principal amount of $11.75 million (the “Note”). The Note has a term of five years, accrues interest at a rate of 5% per annum and provides for the Company to make payments of interest only on a quarterly basis during the term of the Note, with all outstanding amounts being due and payable at the end of the five-year term. In connection with the Company’s investment in Woodbridge, the Company and BFC entered into an Amended and Restated Operating Agreement of Woodbridge, which sets forth the Company’s and BFC’s respective rights as members of Woodbridge and provides for, among other things, unanimity on certain specified “major decisions” and distributions to be made on a pro rata basis in accordance with the Company’s and BFC’s percentage equity interests in Woodbridge. The total amount of the investment was determined through negotiations between the Company’s special committee, as described below, and BFC, and based on factors considered by them to be appropriate, including the total consideration to be paid to Bluegreen’s shareholders in the Merger, available cash at the Company and the outstanding balance of Woodbridge’s junior subordinated debt.

BFC currently owns shares of the Company’s Class A Common Stock and Class B Common Stock representing in the aggregate approximately 75% of the total voting power of the Company. Alan B. Levan, BFC’s Chairman, Chief Executive Officer and President, and John E. Abdo, BFC’s Vice Chairman, serve as Chairman and Chief Executive Officer of the Company and Vice Chairman of the Company, respectively. Jarett S. Levan, the son of Mr. Alan Levan, serves as a director and Executive Vice President of BFC and as a director and President of the Company. In addition, John K. Grelle serves as Executive Vice President and Chief Financial Officer of both BFC and the Company, and Seth M. Wise serves as a director and Executive Vice President of BFC and as Executive Vice President of the Company. In light of such relationships, the Company’s

investment in Woodbridge, including the agreements and instruments relating thereto, was negotiated and approved, in consultation with its advisors, by a special committee of the Company’s Board of Directors comprised solely of independent directors, and subsequently approved by the Company’s full Board of Directors.

The description of the Agreement, the Note and the Amended and Restated Operating Agreement of Woodbridge set forth above is a summary only and is qualified in its entirety by reference to the full text of such documents, copies of which are attached hereto as Exhibits 2.1, 10.1 and 10.2, respectively, and are incorporated herein by reference.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth in Item 2.01 above relating to the Note and the copy of the Note which is filed as Exhibit 10.1 hereto are incorporated into this Item 2.03 by reference.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On April 2, 2013, D. Keith Cobb provided notice to the Company of his resignation from the Company’s Board of Directors. Mr. Cobb’s resignation was effective April 3, 2013.

Item 9.01 Financial Statements and Exhibits.

(a) Financial statements of businesses acquired. The financial statements of Woodbridge required to be filed under this Item 9.01(a) will be included in an amendment to this Current Report on Form 8-K to be filed not later than 71 days after the date on which this Current Report on Form 8-K is required to be filed.

(b) Pro forma financial information. The pro forma financial information required to be filed under this Item 9.01(b) will be included in an amendment to this Current Report on Form 8-K to be filed not later than 71 days after the date on which this Current Report on Form 8-K is required to be filed.

(d) Exhibits.


Exhibit 2.1		Purchase Agreement, dated as of April 2, 2013, by and among Woodbridge Holdings, LLC, BBX Capital Corporation and BFC Financial Corporation

Exhibit 10.1		Promissory Note, dated April 2, 2013, issued by BBX Capital Corporation in favor of Woodbridge Holdings, LLC

Exhibit 10.2		Amended and Restated Operating Agreement of Woodbridge Holdings, LLC

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 hereunto duly authorized.


	BBX CAPITAL CORPORATION

Date: April 5, 2013

	By:	/s/ John K. Grelle
		John K. Grelle,
		Executive Vice President and Chief Financial Officer

EXHIBIT INDEX


Exhibit		Description

2.1		Purchase Agreement, dated as of April 2, 2013, by and among Woodbridge Holdings, LLC, BBX Capital Corporation and BFC Financial Corporation

10.1		Promissory Note, dated April 2, 2013, issued by BBX Capital Corporation in favor of Woodbridge Holdings, LLC

10.2		Amended and Restated Operating Agreement of Woodbridge Holdings, LLC, dated April 2, 2013

EX-2.1 2 d516900dex21.htm EX-2.1 EX-2.1

Exhibit 2.1

EXECUTION VERSION

WOODBRIDGE HOLDINGS, LLC

PURCHASE AGREEMENT

Dated as of April 2, 2013

PURCHASE AGREEMENT

This PURCHASE AGREEMENT (this “Agreement”), dated as of April 2, 2013, is made by and among Woodbridge Holdings, LLC, a Florida limited liability company (the “Company” or “Woodbridge”), BBX Capital Corporation, a Florida corporation (the “Investor”), and, solely for the limited purposes of Section 7, BFC Financial Corporation, a Florida corporation (“BFC”).

RECITALS

WHEREAS, Woodbridge currently owns shares of common stock of Bluegreen Corporation, a Massachusetts corporation (“Bluegreen”), representing approximately 53.4% of the issued and outstanding shares of such stock;

WHEREAS, BFC, Woodbridge, Bluegreen and BXG Florida Corporation, a Florida Corporation (“BXG”), are parties to an Agreement and Plan of Merger (the “Merger Agreement”), dated as of November 14, 2012, pursuant to which BXG would merge with and into Bluegreen (the “Merger”), with Bluegreen continuing as the surviving corporation of the Merger and a wholly owned subsidiary of Woodbridge, upon the terms and conditions set forth in the Merger Agreement;

WHEREAS, subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger, each share of Bluegreen common stock issued and outstanding immediately prior to such effective time (other than shares of Bluegreen common stock to be canceled without any consideration therefor pursuant to Section 3.1(c) of the Merger Agreement and the Dissenting Shares (as defined in the Merger Agreement)) shall be converted into the right to receive $10.00 in cash, without interest thereon (the “Merger Consideration”);

WHEREAS, BFC’s and Woodbridge’s obligations to consummate the Merger are conditioned upon, inter alia, Woodbridge obtaining the financing to fund the Merger Consideration, with the Cash Portion (as defined below) comprising a material part of such financing;

WHEREAS, Woodbridge desires to issue and sell to the Investor an aggregate of 46 units (the “Units”) of membership interests in Woodbridge (“Membership Interests”) which would represent 46% of the total outstanding Membership Interests, and the Investor desires to purchase the Units on the terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the mutual promises, representations, warranties, covenants and conditions set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

1.	Purchase and Sale.

1.1 Sale and Issuance of the Units. In consideration of and in reliance upon the representations, warranties and covenants set forth herein and in each of the other agreements and documents contemplated hereby and subject to the terms and conditions set forth in this Agreement (including, without limitation, the conditions set forth in Sections 5 and 6), the Company shall issue and sell to the Investor, and the Investor shall purchase from the Company, the Units for $60 million in cash (the “Cash Portion”) and $11.75 million in the form of a promissory note issued by the Investor in favor of the Company (the “Debt Portion”, and, together with the Cash Portion, the “Purchase Price”).

1.2 Closing. The closing of the purchase and sale of the Units shall take place at the offices of Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A., 150 West Flagler Street, Miami, Florida 33130, contemporaneously with the closing of the Merger (as set forth in the Merger Agreement), subject to the satisfaction or waiver of all of the conditions set forth in this Agreement (which time, date and place are referred to in this Agreement as the “Closing”). For purposes of allocation of expenses, adjustments, tax and other financial effects of the transactions contemplated hereby, the Closing shall be deemed to have occurred at 11:59 p.m. Eastern Standard Time on the date of the Closing. The transfers and deliveries described in Section 5 and Section 6 shall be mutually interdependent and shall be regarded as occurring simultaneously, and, any other provision of this Agreement notwithstanding, no such transfer or delivery shall become effective or shall be deemed to have occurred until all of the other transfers and deliveries provided for in Section 5 and Section 6 shall also have occurred.

1.3 Taxes and Filings. The Company shall pay all taxes payable with respect to the issuance of the Membership Interests and shall make all appropriate filings required to be made by the Company with respect to the transactions contemplated by this Agreement.

2.	Representations and Warranties of the Company.

For purposes of the representations and warranties set forth in this Section 2, “Knowledge” with respect to the Company means the actual knowledge of a particular fact or other matter of Alan B. Levan, Seth M. Wise or John K. Grelle after reasonable inquiry and diligence taking into account the respective duties and responsibilities of each such officer of Woodbridge. In this Agreement, “Material Adverse Effect” means, with respect to the Company and Bluegreen, an effect, event, development or change that is materially adverse to the business, assets, properties, results of operations or financial condition of the Company and Bluegreen, taken as a whole, or any effect, event, development or change arising out of or resulting therefrom, in each case other than any of the following: (i) changes in the general United States or global economy, or conditions that affect the real estate, timeshare sales or marketing, or resort management industries generally, (ii) acts of war, armed hostilities, sabotage or terrorism, or any escalation or worsening of any such acts of war, armed hostilities, sabotage or terrorism threatened or underway as of the date of this Agreement, (iii) earthquakes, hurricanes, floods or other natural disasters, (iv) changes in generally accepted accounting principles (“GAAP”) following the date hereof, (v) changes in law following the date hereof or (vi) the announcement of this Agreement and the transactions contemplated hereby, provided that, in the case of clauses (i)-(v), such effects do not have a disproportionate impact on the Company or Bluegreen relative to other participants in the real estate, timeshare sales and marketing and resort management

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industries. For all purposes of this Agreement, the transactions and other documents and agreements contemplated hereby shall not be deemed to include the Merger Agreement or the Merger (except as it relates to the financing thereof).

2.1 Organization and Standing.

(a) The Company (i) is a limited liability company duly organized and validly existing under the laws of the State of Florida, and its status is active, (ii) has all requisite limited liability company power and authority to carry on its business as now conducted and as currently proposed to be conducted and (iii) except as could not reasonably be expected to have a Material Adverse Effect, is duly qualified to transact business and is in good standing in each other jurisdiction where such qualification is necessary.

(b) To the Company’s Knowledge, Bluegreen (i) is a corporation duly organized, validly existing and in good standing under the laws of the State of Massachusetts, (ii) has all requisite corporate power and authority to carry on its business as now conducted and as currently proposed to be conducted and (iii) except as could not reasonably be expected to have a Material Adverse Effect, is duly qualified to transact business and is in good standing in each other jurisdiction where such qualification is necessary.

2.2 Capitalization. BFC owns all the outstanding equity securities of Woodbridge. Other than as contemplated by this Agreement, there are no options, warrants or rights outstanding to acquire any equity securities of Woodbridge. Immediately following the Closing, the outstanding capital of the Company will consist of 100 units of Membership Interests, 46 of which will be held by the Investor and 54 of which will be held by BFC.

2.3 Subsidiary. At the Closing, after giving effect to the consummation of the Merger, the Company will be the sole record and beneficial owner of one hundred percent (100%) of the issued and outstanding equity securities of Bluegreen with good and valid title thereto, free and clear of all liens, charges, restrictions, claims and encumbrances (“Encumbrances”), and with the sole right to vote such equity securities.

2.4 Authorization; Enforceability.

(a) The Company has all requisite limited liability company power and authority to execute, deliver and perform, as applicable, this Agreement and each of the other agreements and documents contemplated hereby.

(b) All limited liability company action on the part of the Company and its officers, managers and equity holders necessary for (i) the authorization, execution, delivery and performance of all obligations of the Company under this Agreement and each of the other agreements and documents contemplated hereby and (ii) the issuance and sale by the Company of the Units hereunder, has been taken or will be taken at or prior to the Closing. Assuming the due execution by all applicable counterparties, each of this Agreement and each of the other agreements and documents contemplated hereby constitutes, or will constitute as of the Closing, a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except (A) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally or by equitable principles, (B) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (C) to the extent that the enforceability of the indemnification provisions may be limited by applicable laws.

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2.5 Validity of Securities and Issuance. The Units (i) are duly authorized, (ii) when issued and sold to the Investor in accordance with the terms of this Agreement will be validly issued, (iii) after receipt of all consideration due therefor, will be fully paid and nonassessable with no personal liability attaching to the ownership thereof and (iv) will be free and clear of any and all Encumbrances created as a result of actions taken by the Company.

2.6 Financial Statements; Liabilities.

(a) The Company has delivered to the Investor the consolidated balance sheets of the Company and Bluegreen as of December 31, 2012 and December 31, 2011 (collectively, the “Financial Statements”).

(b) The Financial Statements of the Company, adjusted to reflect the Company’s interest in Bluegreen on a non-consolidated basis (the “Company Financial Statements”), fairly present in all material respects the financial condition and results of operations of the Company (excluding the consolidated financial condition and results of operations of Bluegreen), and have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis throughout the periods indicated and with each other (other than as specifically noted therein or normally recurring adjustments in the Company Financial Statements as of December 31, 2012). There are no liabilities or obligations of the Company, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due, including any liability or obligation for taxes and any liability under any guaranty or indemnification arrangement, but in each case excluding any liabilities or obligations of Bluegreen (“Company Liabilities”), other than as reflected in the Company Financial Statements as of December 31, 2012, the obligations of the Company provided for in this Agreement and Company Liabilities incurred after December 31, 2012 in the ordinary course of business consistent with past practice. Notwithstanding anything to the contrary contained in this Agreement, any revision or restatement of the Company Financial Statements which results solely from a revision or restatement of the Financial Statements of Bluegreen shall not be deemed to constitute a breach of this representation and warranty for purposes of the indemnification provisions contained in Section 7.

(c) To the Company’s Knowledge, the Financial Statements of Bluegreen fairly present in all material respects the financial condition and results of operations of Bluegreen, and have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis throughout the periods indicated and with each other (other than as specifically noted therein or normally recurring adjustments in the Financial Statements of Bluegreen as of December 31, 2012). To the Company’s Knowledge, there are no liabilities or obligations of Bluegreen, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due, including any liability or obligation for taxes and any liability under any guaranty or indemnification arrangement (“Bluegreen Liabilities”), other than as reflected in the Financial Statements of Bluegreen as of December 31, 2012, the obligations of Bluegreen with respect to the Merger and Bluegreen Liabilities incurred after December 31, 2012 in the ordinary course of business consistent with past practice.

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2.7 Absence of Events. Except as set forth in “Item 3 - Legal Proceedings” and “Item 8 – Financial Statements and Supplementary Data” of BFC’s Annual Report on Form 10-K for the year ended December 31, 2012 (the “2012 10-K”) or as contemplated by this Agreement or the Merger Agreement, from December 31, 2012 through the date hereof, the Company has not:

(a) suffered an event which has had or could reasonably be expected to have a Material Adverse Effect;

(b) experienced any material damage, destruction or loss to any of its material assets (whether or not covered by insurance);

(c) sold, exchanged or otherwise disposed of, or pledged, mortgaged or encumbered in any way, any of its material assets or rights or any revenues derived therefrom, other than in the ordinary course of business;

(d) declared or paid or set aside any dividends or reserved funds or authorized or made any distribution upon or with respect to the outstanding Membership Interests or any other securities or equity interests of the Company;

(e) incurred any indebtedness for money borrowed or any other liabilities which individually are in excess of $250,000, or made any loans or advances to any natural person, corporation, limited partnership, general partnership, limited liability company, joint stock company, joint venture, association, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, or any government or governmental agency (each a “Person”), other than advances for travel or other business expenses consistent with past practice;

(f) made any material change in any accounting principle or method or election for federal income tax purposes used by the Company except for changes required by GAAP;

(g) acquired any assets or property or made any capital expenditures, additions or improvements or commitments for the same, except those which do not exceed $250,000 in the aggregate; or

(h) committed to do any of the foregoing.

2.8 Litigation. Except as set forth in “Item 3 – Legal Proceedings” and “Item 8 – Financial Statements and Supplementary Data” of the 2012 10-K, (i) there is no material action, suit, proceeding or investigation pending or, to the Company’s Knowledge, threatened against the Company or, to the Company’s Knowledge, against any manager, officer or employee of the Company, in his or her capacity as such, and (ii) the Company is not a party to, or subject to the provisions of, any material order, writ, injunction, judgment or decree of any court or government agency or instrumentality. The foregoing includes, without limitation, any suits, claims, actions, proceedings or investigations pending or, to the Company’s Knowledge, threatened involving the prior employment of any of the Company’s employees, their employment in connection with the Company’s business or any information or techniques allegedly proprietary to any of their former employers, or their obligations under any agreements with prior employers. Except as set forth in “Item 3 – Legal Proceedings” and “Item 8 –

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Financial Statements and Supplementary Data” of the 2012 10-K, there is no material action, suit, proceeding or investigation which has been initiated by the Company and is currently pending or that the Company intends to initiate.

2.9 Compliance with Law and Instruments; Permits. The Company has not violated in any material respect any material applicable statute, rule, regulation, order or restriction of any domestic or foreign government or any instrumentality or agency thereof in respect of the conduct of its business or the ownership of its properties. The Company has all material franchises, permits, licenses and similar authority necessary for the conduct of its business.

2.10 Tax Returns and Payments. All federal, state and local tax returns and reports of the Company required by law to be filed have been duly filed and all taxes and other fees due thereon have been paid. No material audit, deficiency, assessment or proposed adjustment of the Company’s federal, state or local income, franchise or other taxes has occurred in the past five years or is pending and there is no material tax lien, whether imposed by any federal, state, county or local taxing authority, outstanding against the assets, properties or business of the Company.

2.11 Consents. Except for the consent of BFC, as the sole member of the Company (which consent has been obtained), no consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any governmental entity or any other Person or entity is required to be made or obtained by the Company in connection with the consummation of the transactions contemplated by this Agreement or the other agreements and documents contemplated hereby.

2.12 Investment Company. The Company is not, and immediately following the Closing will not be, an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended (the “Investment Company Act”). For the avoidance of doubt, the Company does not represent or warrant with respect to the “investment company” status (within the meaning of the Investment Company Act) of the Investor.

2.13 Finders. The Company is not obligated for any finder’s fee or commission in connection with the transactions contemplated hereby.

2.14 Disclosure. To the Company’s Knowledge, no representation, warranty or statement by the Company in this Agreement (including the exhibits hereto) or in any of the other agreements and documents contemplated hereby, or in any written statement or certificate furnished to the Investor pursuant to such agreements, or the transactions contemplated hereby or thereby, contains any untrue statement of a material fact or, when taken together, omits to state a material fact necessary to make the statements made herein or therein, in light of the circumstances under which they were made, not misleading.

3.	Representations and Warranties of the Investor.

As a material inducement to the Company to enter into and perform its obligations under this Agreement, the Investor represents and warrants to the Company as of the date hereof and the Closing as follows:

3.1 Organization; Standing. The Investor is a corporation duly organized and validly existing under the laws of the State of Florida, and its status is active. The Investor has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted and as currently proposed to be conducted.

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3.2 Authorization; Enforceability. The Investor has all requisite corporate power and authority to execute, deliver and perform this Agreement and each of the other agreements and documents contemplated hereby. All action on the part of the Investor and its directors, officers and shareholders, necessary for the authorization, execution, delivery and performance of all obligations of the Investor under this Agreement and each of the other agreements and documents contemplated hereby to which it is a party has been taken or will be taken at or prior to the Closing. Assuming the due execution by all applicable counterparties, this Agreement and each of the other agreements and documents contemplated hereby to which the Investor is a party constitutes the valid and legally binding obligation of the Investor, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally or by equitable principles, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies and (iii) to the extent that the enforceability of indemnification provisions may be limited by applicable laws.

3.3 Investment Intent. The Units will be acquired by the Investor for its own account for investment purposes and not with a view to, or for sale in connection with, any distribution or granting of a participation right therein, in whole or in part, in violation of the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any jurisdiction applicable to the Investor.

3.4 Accredited Investor. The Investor is an “accredited investor” within the meaning of Rule 501(a) promulgated under the Securities Act.

3.5 Consents. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any governmental entity or any other Person or entity is required to be made or obtained by the Investor in connection with the consummation of the transactions contemplated by this Agreement or any of the other agreements and documents contemplated hereby.

3.6 Financing. The Investor shall have at the Closing sufficient unrestricted cash on hand to pay the Cash Portion.

4.	Covenants.

4.1 Operation of the Business. From the date hereof until the Closing (unless the Investor shall otherwise consent in writing, which consent shall not be unreasonably withheld, conditioned or delayed, or unless otherwise expressly permitted hereunder) the Company shall (a) conduct its business in the ordinary course consistent with past practice and in compliance with all applicable laws, (b) use its reasonable best efforts to preserve intact its business assets, organizations, relationships with third parties and goodwill and keep available the services of its present employees and independent contractors, (c) confer with the Investor concerning operational matters of a material nature and (d) otherwise convey to the Investor the occurrence of any material event as soon as reasonably practicable. Without limiting the generality of the foregoing, during the period from the date hereof until the Closing (unless the Investor shall otherwise consent in writing, which consent shall not be unreasonably withheld, conditioned or

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delayed, or unless otherwise expressly permitted hereunder), (1) the Company shall not issue or sell any Membership Interests, (2) BFC shall not sell, pledge, transfer, dispose of or encumber any of its Membership Interests, (3) the Company shall not take, and shall use its reasonable best efforts to not permit or suffer to occur or exist, any action, circumstance or state of facts described in Section 2.8, and (4) the Company shall not consent to Bluegreen taking, or permitting or suffering to occur or exist, any action, circumstance or state of facts described in Section 6.1 of the Merger Agreement.

4.2 Efforts to Consummate; Filings and Approvals.

Each of the Company and the Investor shall use its reasonable best efforts to take all actions and do all things necessary to consummate, as soon as reasonably practicable, the transactions contemplated hereby, including, without limitation, satisfying the conditions to the other party’s obligations to close the transactions contemplated hereby and avoiding taking any action that would reasonably be expected to materially delay the obtaining of, or result in not obtaining, any consent or order from any Person prior to the Closing.

4.3 Notification.

(a) The Company shall promptly notify the Investor in writing if, at any time prior to the Closing, the Company becomes aware of any material event, fact or condition that would cause the Company’s representations and warranties in this Agreement to be untrue in any material respect or which makes the satisfaction of the conditions to the Investor’s obligations to close the transactions contemplated hereby impossible or unlikely; provided that no disclosure by the Company pursuant to this Section 4.3(a) shall be deemed to amend or supplement any representation or to prevent or cure any misrepresentation, breach of warranty or breach of covenant or other breach of this Agreement.

(b) The Investor shall promptly notify the Company in writing if, at any time prior to the Closing, the Investor becomes aware of any event, fact or condition that would cause the Investor’s representations and warranties in this Agreement to be untrue in any material respect or which makes the satisfaction of the conditions to the Company’s obligation to close the transactions contemplated hereby impossible or unlikely; provided that no disclosure by the Investor pursuant to this Section 4.3(b) shall be deemed to amend or supplement any representation or to prevent or cure any misrepresentation, breach of warranty or breach of covenant or other breach of this Agreement.

4.4 Use of Proceeds. All of the Cash Portion of the Purchase Price will be used by the Company as Merger Consideration or to pay fees and expenses related to the Merger.

5.	Conditions to the Investor’s Obligations at the Closing.

The obligation of the Investor under this Agreement to purchase and pay for the Units being purchased by it at the Closing and otherwise consummate the transactions contemplated hereby is subject to the fulfillment (or waiver by the Investor in writing), on or before the Closing, of the following conditions:

5.1 Representations and Warranties. The representations and warranties of the Company contained in Section 2 that are qualified by materiality or “Material Adverse Effect” shall be true, correct and complete on and as of the date of this Agreement and the Closing with the same force and effect as if they had been made at such time, and the representations and

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warranties of the Company contained in Section 2 that are not so qualified shall be true, correct and complete in all material respects on and as of the date of this Agreement and the Closing with the same force and effect as if they had been made at such time; provided, however, that representations and warranties that address matters as of a particular date shall be true and correct or true and correct in all material respects, as applicable, as of such date.

5.2 Performance. The Company shall have performed and complied in all material respects with all other conditions, covenants and agreements contained in this Agreement required to be performed or complied with by it on or before the Closing.

5.3 Approvals and Waivers. Any consent required for the consummation of the transactions contemplated by this Agreement and the other agreements and documents contemplated hereby shall have been obtained. All permits, approvals, filings and consents required to be obtained or made, and all waiting periods required to expire, prior to the consummation of the transactions contemplated by this Agreement and the other agreements and documents contemplated hereby under all applicable laws, rules and regulations shall have been obtained, made or expired, as the case may be, and all such waiting periods shall have lapsed, and all such permits, approvals, filings and consents shall be in full force and effect.

5.4 No Material Adverse Change. From the date of this Agreement to the Closing, there shall have not occurred a Material Adverse Effect with respect to the Company or Bluegreen which is continuing.

5.5 Amended and Restated Company Operating Agreement. BFC shall have executed and delivered the Amended and Restated Company Operating Agreement in the form attached hereto as Exhibit A (the “Amended and Restated Company Operating Agreement”).

5.6 Related Documents. The Company and all other parties thereto shall have executed and delivered to the other parties each of the other agreements and documents contemplated hereby to which they are a party.

5.7 Merger Agreement Closing Obligations. BFC or the Company shall have delivered to the Investor a copy of the Officer’s Certificate of Bluegreen delivered to BFC and/or the Company pursuant to Section 8.3(d) of the Merger Agreement, and, except for those obligations of each party under the Merger Agreement which have to be fulfilled immediately prior to or at the closing of the Merger, the respective obligations of each party under the Merger Agreement to consummate and effect the Merger and the other transactions contemplated under the Merger Agreement shall have been fulfilled or waived; provided further that none of the conditions set forth in Section 8.3 of the Merger Agreement to the obligations of BFC and the Company to consummate and effect the Merger and the other transactions contemplated under the Merger Agreement shall have been waived without the prior written consent of the Investor.

5.8 Compliance Certificate. The Company shall have delivered to the Investor a certificate, dated as of the Closing, of its Chief Executive Officer certifying that the conditions specified in Sections 5.1 and 5.2 have been fulfilled.

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6.	Conditions to the Company’s Obligations at the Closing.

The obligations of the Company under this Agreement are subject to the satisfaction (or waiver in writing by the Company) on or before the Closing of each of the following conditions:

6.1 Representations and Warranties. The representations and warranties of the Investor contained in Section 3 shall be true, correct and complete in all material respects on and as of the date of this Agreement and the Closing with the same force and effect as if they had been made at such time.

6.2 Performance. The Investor shall have performed and complied in all material respects with all other conditions, covenants and agreements contained in this Agreement required to be performed or complied with by it on or before the Closing.

6.3 Promissory Note. The Investor shall have executed and delivered to the Company the promissory note in the form attached hereto as Exhibit B (the “Promissory Note”).

6.4 Amended and Restated Company Operating Agreement. The Investor shall have executed and delivered the Amended and Restated Company Operating Agreement.

6.5 Related Documents. The Investor and all other parties thereto shall have executed and delivered to the other parties each of the other agreements and documents contemplated hereby to which they are a party.

6.6 Transfer of Funds. The Investor shall have delivered the Cash Portion payable in immediately available funds by wire transfer to an account or accounts designated by the Company in writing.

6.7 Approvals and Waivers. Any consent required for the consummation of the transactions contemplated by this Agreement and the other agreements and documents contemplated hereby shall have been obtained. All permits, approvals, filings and consents required to be obtained or made, and all waiting periods required to expire, prior to the consummation of the transactions contemplated by this Agreement and the other agreements and documents contemplated hereby under all applicable laws, rules and regulations shall have been obtained, made or expired, as the case may be, and all such waiting periods shall have lapsed, and all such permits, approvals, filings and consents shall be in full force and effect.

6.8 Merger Agreement Closing Obligations. The respective obligations of each party under the Merger Agreement to consummate and effect the Merger and the other transactions contemplated under the Merger Agreement shall have been fulfilled or waived, except for those obligations of each party under the Merger Agreement which have to be fulfilled immediately prior to the closing of the Merger.

6.9 Compliance Certificate. The Investor shall have delivered to the Company a certificate, dated as of the Closing, of its President certifying that the conditions specified in Sections 6.1 and 6.2 have been fulfilled.

7.	Indemnification.

7.1 Indemnification by BFC. Subject to Section 7.2, BFC shall indemnify, defend and hold harmless the Investor and its directors, officers, shareholders and representatives (collectively, the “Investor Indemnified Parties”) after the Closing from and against any losses, deficiencies, damages, expenses, liabilities, assessments and judgments (including, without limitation, any consequential, punitive or special damages and reasonable costs and attorneys’ fees and other expenses arising out of any claim, or the defense or investigation thereof, made with respect to any of the foregoing) (collectively, the “Indemnifiable Expenses”) arising out of,

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based upon or resulting from (a) any inaccuracy of any representation or warranty of the Company contained in this Agreement (including all exhibits hereto) or in any certificate or document delivered by the Company in connection herewith (other than any inaccuracy of the representations and warranties set forth in Section 2.1(b) or Section 2.6(c)) and (b) any breach of any covenant or agreement of the Company contained in this Agreement.

7.2 Limitations on Liability.

(a) The representations and warranties of the Company contained herein (including all exhibits hereto) or in any certificate or document delivered by the Company in connection herewith (other than the representations and warranties set forth in Section 2.1(b) and Section 2.6(c), and as qualified by the last sentence of Section 2.6(b)) shall survive the Closing for a period of 18 months after the Closing, and thereafter BFC shall not have any liability (for indemnification or otherwise) with respect to any such representation or warranty, unless on or before the 18-month anniversary of the Closing, the Investor or applicable Investor Indemnified Party notifies BFC in writing of a claim for indemnification to be asserted specifying the factual basis of that claim in reasonable detail. The representations and warranties set forth in Section 2.1(b) and Section 2.6(c) shall not survive the Closing, and BFC shall not have any liability (for indemnification or otherwise) with respect thereto.

(b) BFC will have no obligation to indemnify any Investor Indemnified Party for any Indemnifiable Expenses under this Section 7 until such time as such Indemnifiable Expenses, in the aggregate, exceed $750,000, at which point BFC shall be liable for the entire amount of Indemnifiable Expenses, including the $750,000 threshold amount; provided, however, that the maximum amount of Indemnifiable Expenses for which BFC shall be liable under this Section 7 shall be $30,000,000 in the aggregate.

General.

8.1 Termination.

(a) This Agreement may, by written notice given prior to or at the Closing, be terminated:

(i) by each of the Company and the Investor, if the other party has breached any agreement or covenant of this Agreement in any material respect and such breach has not been waived; provided that if such breach is capable of being cured a party may not terminate this Agreement under this Section 8.1(a)(i) until a period of fifteen (15) days has expired from the date of written notice of such breach without such breach having been cured;

(ii) (A) by the Investor, if satisfaction of any of the conditions in Section 5 are or became impossible (other than through the failure of the Investor to comply with its obligations under this Agreement) and the Investor has not waived such condition or (B) by the Company, if satisfaction of any of the conditions in Section 6 are or became impossible (other than through the failure of the Company to comply with its obligations under this Agreement) and the Company has not waived such condition;

(iii) by mutual consent of the Investor and the Company;

(iv) by the Investor (other than through failure of the Investor to comply with its obligations under this Agreement) or by the Company (other than through failure of the Company to comply with its obligations under this Agreement) if the Closing has not occurred before September 30, 2013.

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(b) This Agreement shall terminate automatically and without any further action by the parties in the event of termination of the Merger Agreement.

If this Agreement is terminated pursuant to this Section 8.1, all further obligations of the parties under this Agreement shall terminate without liability of any party to the other parties to this Agreement.

8.2 Expenses. Each party will pay its own expenses in connection with the transactions contemplated by this Agreement and the other agreements and documents contemplated hereby.

8.3 Successors and Assigns. Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and permitted assigns of the parties (including permitted transferees of any Membership Interests). Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by the Company or the Investor without the prior written consent of the other party. Any attempted assignment made in contravention of this Agreement shall be null and void and of no force or effect.

8.4 Amendment. This Agreement may be amended or modified in whole or in part at any time only by a writing signed by all of the parties hereto.

8.5 Remedies. Except for claims seeking specific performance or other injunctive relief or claims of, or causes of action arising from, fraud or willful misconduct, the indemnification provisions contained in Section 7 hereof constitute the sole and exclusive post-Closing remedy for breaches of representations, warranties and covenants contained in this Agreement. Subject to the preceding sentence, no remedy or election hereunder shall be deemed exclusive but shall, wherever possible, be cumulative with all other remedies at law or in equity.

8.6 No Waiver. No waiver of any provision or consent to any action shall constitute a waiver of any other provision or consent to any other action, whether or not similar. No waiver or consent shall constitute a continuing waiver or consent or commit a party to provide a waiver in the future except to the extent specifically set forth in writing. Any term, condition or provision of this Agreement may be waived in writing at any time by the party which is entitled to the benefits thereof. No such waiver shall constitute a waiver of any of the waiving party’s other rights or remedies or of any other or future breach, violation or default hereunder.

8.7 Consent to Jurisdiction.

(a) Each of the parties hereto irrevocably submits to the exclusive jurisdiction of the federal and state courts of Florida located in Broward County, Florida for the purpose of any action arising out of or relating to this Agreement, and each of the parties hereto irrevocably agrees that all claims in respect to such action may be heard and determined exclusively in such courts. Each of the parties hereto agrees that a final judgment in any action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable law.

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(b) Each party hereby (i) consents to service of process in any action between the parties arising in whole or in part under or in connection with this Agreement in any manner permitted by the laws of the State of Florida, (ii) agrees that service of process made in accordance with clause (i) or made by registered or certified mail, return receipt requested, at its address specified pursuant to Section 8.11, will constitute good and valid service of process in any such action and (iii) waives and agrees not to assert (by way of motion, as a defense, or otherwise) in any such action any claim that service of process made in accordance with clause (i) or (ii) does not constitute good and valid service of process.

8.8 Jury Trial Waiver. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.9.

8.9 Governing Law. This Agreement shall be governed by, and construed and interpreted in accordance with, the laws of the State of Florida, without giving effect to principles of conflicts of laws.

8.10 Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly received (i) on the date given if delivered personally or by facsimile (ii) one day after being sent by nationally recognized overnight delivery service or (iii) five days after having been mailed by registered or certified mail (postage prepaid, return receipt requested), to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to Woodbridge or BFC, addressed to the applicable party at:

401 East Las Olas Blvd., Suite 800

Fort Lauderdale, Florida 33301

Attention: Chief Executive Officer

Facsimile: (954) 940-5050

with a copy addressed to (which shall not constitute notice):

Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A.

150 West Flagler Street, Suite 2200

Miami, Florida 33130

Attention: Alison W. Miller, Esq.

Facsimile: (305) 789-3395

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If to the Investor, addressed to:

BBX Capital Corporation

401 East Las Olas Blvd., Suite 800

Fort Lauderdale, FL 33301

Attention: President

Facsimile: (954) 940-5050

and to

David A. Lieberman, Chairman of the Special Committee of the Board of Directors

P.O. Box 39001

Fort Lauderdale, FL 33303

Facsimile: (954) 940-5050

with a copy addressed to (which shall not constitute notice):

Hogan Lovells US LLP

Columbia Square

555 Thirteenth Street, NW

Washington, DC 20004

Attention: Stuart Stein, Esq. and Daniel Keating, Esq.

Facsimile: (202) 637-5910

8.11 Severability. If any term or provision of this Agreement is determined to be illegal, unenforceable or invalid in whole or in part for any reason, such illegal, unenforceable or invalid provisions or part thereof shall be stricken from this Agreement, and such provision shall not affect the legality, enforceability or validity of the remainder of this Agreement. If any provision or part thereof of this Agreement is stricken in accordance with the provisions of this Section 8.12, then such stricken provision shall be replaced, to extent possible, with a legal, enforceable and valid provision that is as similar in tenor to the stricken provision as is legally possible.

8.12 Entire Agreement. This Agreement, including the exhibits hereto, constitute the entire agreement among the parties and supersede all prior communications, representations, understandings and agreements of the parties with respect to the subject matter hereof. No party shall be liable or bound to any other party in any manner by any warranties, representations or covenants except as specifically set forth herein. All exhibits hereto are hereby incorporated herein by reference. Nothing in this Agreement, express or implied, is intended to confer upon any third party any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

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8.13 Section Headings. The section headings in this Agreement are for the convenience of the parties and in no way alter, modify, amend, limit or restrict the contractual obligations of the parties.

8.14 General Interpretation. The terms of this Agreement have been negotiated by the parties hereto and the language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent. This Agreement shall be construed without regard to any presumption or rule requiring construction against the party causing such instrument or any portion thereof to be drafted, or in favor of the party receiving a particular benefit under this Agreement. No rule of strict construction will be applied against any Person. For all purposes of this Agreement, unless otherwise expressly provided or unless the context otherwise requires:

(a) any pronouns used in this Agreement shall include the corresponding masculine, feminine or neutral forms, and the singular form of nouns and pronouns shall include the plural, and vice versa;

(b) the words “herein”, “hereto” and “hereby”, and other words of similar import, refer to this Agreement as a whole and not to any particular Section or other subdivision of this Agreement;

(c) references to Sections, clauses, other subdivisions and exhibits are references to Sections, clauses, other subdivisions and exhibits of this Agreement;

(d) any reference herein to a statute, rule or regulation of any governmental entity (or any provision thereof) shall include such statute, rule or regulation (or provision thereof), including any successor thereto, as it may be amended from time to time; and

(e) any reference to the “Company” shall mean the Company, acting through its authorized officers or board of managers and shall not, unless otherwise expressly indicated or as required by applicable law, mean the shareholders or imply any action or approval thereby.

8.15 Counterparts; Facsimile Signatures. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which together shall constitute one and the same document. This Agreement may be executed by facsimile or .pdf signatures.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have executed this Purchase Agreement as of the date first above written.


WOODBRIDGE HOLDINGS, LLC

By:	/s/ Seth M. Wise
	Name:	Seth M. Wise
	Title:	President

BBX CAPITAL CORPORATION

By:	/s/ John K. Grelle
	Name:	John K. Grelle
	Title:	Executive Vice President and Chief Financial Officer

Solely with respect to Section 7:


BFC FINANCIAL CORPORATION

By:	/s/ Seth M. Wise
	Name:	Seth M. Wise
	Title:	Executive Vice President

[PURCHASE AGREEMENT]

EX-10.1 3 d516900dex101.htm EX-10.1 EX-10.1

Exhibit 10.1

EXECUTION VERSION

PROMISSORY NOTE


$11,750,000.00		April 2, 2013

FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged, the undersigned, BBX Capital Corporation, a Florida corporation (“Maker”), unconditionally promises to pay to the order of Woodbridge Holdings, LLC, a Florida limited liability company (“Holder”), without setoff, the principal sum of Eleven Million Seven Hundred Fifty Thousand Dollars ($11,750,000.00) (the “Principal”), plus interest (the “Interest”) on the Principal from time to time remaining unpaid, calculated at a fixed rate of five percent (5%) per annum (computed on the basis of a 360-day year of 12 consecutive, 30-day months for the number of days actually elapsed), and payable as hereinafter set forth. This Note constitutes the “Promissory Note” which evidences the “Debt Portion” of the “Purchase Price” under, and in each case as defined in, that certain Purchase Agreement, dated as of April 2, 2013, by and among Maker, Holder and, solely for certain limited purposes specified therein, BFC Financial Corporation, a Florida corporation (the “Purchase Agreement”).

1. Payments.

(a) Payments of Interest shall be paid by Maker to Holder on the first business day of each calendar quarter, beginning on the first day of July 2013 and continuing until all unpaid Principal and accrued Interest is paid in full.

(b) Maker shall repay in full to Holder all unpaid Principal and accrued Interest on April 2, 2018.

(c) All payments made to Holder under this Note shall be made: (i) in immediately available funds of lawful money of the United States of America; and (ii) to Holder at 401 East Las Olas Boulevard, Suite 800, Fort Lauderdale, Florida 33301, or at such other place as Holder may from time to time designate to Maker in writing (including, without limitation, by automatic deposit or wire transfer to an account designated by Holder).

(d) This Note may be prepaid at any time and from time to time, in whole or in part, without premium or penalty. Prepayments shall first be applied against accrued and unpaid Interest hereunder and shall then be applied to the Principal hereunder.

2. Authority. Maker represents that it has full power and authority to execute, deliver and perform its obligations under this Note, that the person executing this Note on Maker’s behalf has been duly authorized by Maker to so execute this Note, and that this Note constitutes the valid and binding obligation of Maker.

3. Events of Default. This Note shall be in default (each, a “Default”) if: (a) Maker shall be adjudicated as bankrupt or insolvent, or admits in writing its inability to pay its debts as they mature, or makes a general assignment for the benefit of creditors; (b) Maker shall apply for or consent to the appointment of a receiver, trustee, or similar officer for Maker or for all or any substantial part of its property, or such receiver, trustee or similar officer shall be appointed without the application or consent of Maker and such appointment shall continue undischarged

for a period of sixty (60) days; (c) Maker shall institute (by petition, application, answer, consent or otherwise) any bankruptcy, insolvency, reorganization, arrangement, readjustment of debt, dissolution, liquidation or similar proceeding relating to Maker under the laws of any jurisdiction, or any such proceeding shall be instituted (by petition, application or otherwise) against Maker and shall remain undismissed for a period of sixty (60) days; or (d) Maker fails to make a payment of Principal or of Interest on this Note within ten (10) days after the date upon which such payment becomes due.

4. Default Remedies. Upon the occurrence of a Default, the entire unpaid Principal, together with accrued and unpaid Interest, shall be immediately due and payable without notice or demand, and all amounts then due under this Note shall bear interest at the rate equal to the lesser of ten percent (10%) per annum or the Highest Lawful Rate (as hereinafter defined). In addition, Maker agrees to pay all documented out-of-pocket costs of collection, including, without limitation, reasonable and documented out-of-pocket attorneys’ fees and expenses, in the event of a Default, whether or not a lawsuit is brought. No remedy made available by any provision of this Note is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity.

5. No Usury. Holder shall never be entitled to receive, collect, or apply as interest on amounts outstanding under this Note (for purposes of this section, the word “interest” shall be deemed to include any sums treated as interest under applicable law governing matters of usury and unlawful interest), any amount in excess of the Highest Lawful Rate, and in the event Holder is ever deemed to receive, collect, or apply as interest any such excess, such amount which would be excessive interest shall be deemed a partial prepayment of the Principal and shall be treated hereunder as such. If the Principal is paid in full, any remaining excess shall be promptly paid to Maker, without interest. In determining whether or not the interest paid or payable under any specific contingency exceeds the Highest Lawful Rate, Maker and Holder shall, to the maximum extent permitted under applicable law: (i) characterize any non-principal payment as an expense, fee or premium rather than as interest; (ii) exclude voluntary prepayments and the effects thereof; and (iii) spread the total amount of interest throughout the entire contemplated term of this Note. For purposes of this Note, “Highest Lawful Rate” shall mean the maximum rate of interest which Holder is allowed to contract for, charge, take, reserve or receive under applicable law after taking into account, to the extent required by applicable law, any and all relevant payments or charges hereunder.

6. Taxes and Other Liabilities. Maker agrees to promptly pay, indemnify and hold harmless Holder from all federal, state and local taxes of any kind (except for federal or Florida franchise or income taxes based on Holder’s net income) and other liabilities with respect to or resulting from the execution or delivery of this Note or advances made pursuant to this Note, provided that such indemnity shall not be available to the extent that such liabilities, resulted from (i) the gross negligence or willful misconduct of Holder, as determined by a court of competent jurisdiction in a final and non-appealable judgment or (ii) are indemnifiable under the terms of the Purchase Agreement.

7. Governing Law; Venue. This Note shall be governed by, and construed in accordance with, the laws of the State of Florida, without regard to conflicts of law principles. Maker, and by its acceptance hereof, Holder, each (i) irrevocably consents to the exclusive jurisdiction of any state or federal court sitting in Broward County, Florida, in any litigation in connection with or to enforce this Note and (ii) irrevocably waives any objection that it may now or hereafter have to the laying of venue of any such litigation brought in any such court and any claim that any such litigation brought in any such court has been brought in an inconvenient forum.

8. Miscellaneous.

(a) Maker waives demand, presentment, protest, dishonor and notice of maturity, non-payment or protest and all other requirements to hold Maker liable. Maker shall raise no defense other than that payment has been made. Maker shall not raise any claims of set off in any action or proceeding.

(b) If a payment of the Principal or Interest on this Note becomes due on a Saturday, Sunday or other legal holiday on which banks in the State of Florida are closed, then the due date shall be extended to the next succeeding business day.

(c) If any provision of this Note or portion thereof is declared or found by a court of competent jurisdiction to be unenforceable or null and void, such provision or portion thereof shall be deemed stricken and severed from this Note, and the remaining provisions and portions thereof shall continue in full force and effect.

(d) This Note may be transferred or assigned to and among affiliates of Holder without the consent of Maker, but may not otherwise be transferred or assigned by Holder without the prior written consent of Maker.

(e) This Note may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Maker or Holder, but only by an agreement in writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought.

(f) A delay by Holder in exercising a right or remedy shall not constitute a waiver thereof. No waiver by Holder of any Default hereunder shall be deemed to constitute a waiver of any subsequent or other Default. No exercise of any right or remedy hereunder shall preclude the exercise of any other right or remedy which Holder may have in law or in equity to enforce the paying of this Note or the collection of the amounts owed hereunder.

(g) The headings contained in this Note are for reference purposes only and shall not affect in any way the meaning or interpretation of this Note.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, Maker has duly executed this Note, effective as of the day and year first above written.


BBX CAPITAL CORPORATION,
a Florida corporation

By:		/s/ John K. Grelle
Name:		John K. Grelle
Title:		Executive Vice President and Chief Financial Officer

EX-10.2 4 d516900dex102.htm EX-10.2 EX-10.2

Exhibit 10.2

AMENDED AND RESTATED

OPERATING AGREEMENT

OF WOODBRIDGE HOLDINGS, LLC

(a Florida Limited Liability Company)

THIS AMENDED AND RESTATED OPERATING AGREEMENT (this “Operating Agreement”) of Woodbridge Holdings, LLC, a Florida limited liability company (the “Company”), is entered into, effective as of the 2^nd day of April, 2013, by BFC Financial Corporation, a Florida corporation (“BFC”), and BBX Capital Corporation, a Florida corporation (“BBX Capital” and, together with BFC, including their respective assignees or transferees in accordance with the terms hereof, the “Members”).

RECITAL

WHEREAS, the Company was previously formed as a limited liability company under the Florida Limited Liability Company Act (as amended from time to time, the “Act”) and wholly owned subsidiary of BFC;

WHEREAS, effective as of the date hereof, the Company acquired Bluegreen Corporation, a Massachusetts corporation (“Bluegreen”), pursuant to a cash merger in which BXG Florida Corporation, a wholly owned subsidiary of the Company, merged with and into Bluegreen (the “Merger”), with Bluegreen continuing as the surviving corporation of the Merger and becoming a wholly owned subsidiary of the Company (by virtue of the Company’s ownership of all 100 issued and outstanding shares of Bluegreen’s common stock);

WHEREAS, effective as of the date hereof, BBX Capital contributed cash to the Company in connection with the financing of the Merger, as well as a promissory note, in each case in accordance with the terms and conditions of the Purchase Agreement (the “Purchase Agreement”);

WHEREAS, under the terms of the Purchase Agreement, the Company issued to BBX Capital forty-six (46) Units (as hereinafter defined) representing forty-six percent (46%) of the outstanding membership interests in the Company, with BFC continuing to hold fifty-four (54) Units representing the remaining fifty-four percent (54%) of the outstanding membership interests in the Company; and

WHEREAS, BFC and BBX Capital desire to enter into this Operating Agreement in order to amend and restate in its entirety that certain Operating Agreement of the Company, dated June 30, 2009 (as previously amended, the “Prior Operating Agreement”), and to set forth the terms and conditions of the business and affairs of the Company and determine the rights and obligations of the Members.

NOW, THEREFORE, the Members, intending to be legally bound by this Operating Agreement, hereby agree that the limited liability company operating agreement of the Company shall be as follows:

ARTICLE 1.

DEFINITIONS

When used in this Operating Agreement, the following terms shall have the meanings set forth below.

1.1 “Act” shall have the meaning set forth in the Preamble.

1.2 “Affiliate” means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with the Person specified. For purposes of this definition, control of a Person means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

1.3 “Articles of Organization” means the Articles of Organization of the Company filed with the Florida Department of State on June 30, 2009, as amended from time to time.

1.4 “BBX Capital” shall have the meaning set forth in the Preamble.

1.5 “BFC” shall have the meaning set forth in the Preamble.

1.6 “Bluegreen” shall have the meaning set forth in the Recitals.

1.7 “Board of Managers” means the board of managers of the Company, a manager-managed limited liability company.

1.8 “Call Date” shall have the meaning set forth in Section 4.2(a).

1.9 “Capital Account” means the capital account of a Member maintained in accordance with Section 4.3 hereof.

1.10 “Capital Contribution(s)” means the amount of cash and the agreed value of property, services rendered, or a promissory note or other obligation to contribute cash or property or to perform services contributed by a Member for the Units held by such Member, equal to the sum of such Member’s initial Capital Contributions plus such Member’s additional Capital Contributions, if any, made pursuant to Section 4.2.

1.11 “Code” means the Internal Revenue Code of 1986 and the regulations promulgated thereunder, as amended from time to time.

1.12 “Company” shall have the meaning set forth in the Preamble.

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1.13 “Company Reference Value” means, in the sole discretion of the Contributing Member(s), either (a) the book value of the Company determined in accordance with accounting principles generally accepted in the United States of America as of the most recently completed fiscal year of the Company or (b) the fair market value of the Company (i) determined immediately prior to the Request as to which the Company Reference Value determination is made, (ii) determined by an independent appraiser selected by the Contributing Member(s) and (iii) excluding goodwill not reflected in the Company’s financial statements.

1.14 “Contributing Member(s)” shall have the meaning set forth in Section 4.2(b)(i).

1.15 “Controlled Affiliate” shall mean, with respect to any Person, any other Person that is directly or indirectly controlled by such first Person. For purposes of this definition, “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of voting securities, through other voting rights, by contract or otherwise.

1.16 “Dispose” and “Disposition” shall have the meanings set forth in Section 10.1.

1.17 “Ending Date” shall have the meaning set forth in Section 10.5(e).

1.18 “Indemnified Party” shall have the meaning set forth in Section 13.2.

1.19 “Interest” means, with respect to each Member, the ratio of the number of Units held by the Member to the total of all of the issued and outstanding Units, expressed as a percentage.

1.20 “Issuance Period” shall have the meaning set forth in Section 10.5(e).

1.21 “Issued Price” shall have the meaning set forth in Section 10.5(a).

1.22 “Issued Terms” shall have the meaning set forth in Section 10.5(a).

1.23 “Issued Units” shall have the meaning set forth in Section 10.5(a).

1.24 “Major Decision” shall have the meaning set forth in Section 7.4.

1.25 “Majority-in-Interest of the Members” means Members holding Units representing more than fifty percent (50%) of the outstanding Units.

1.26 “Manager(s)” means the managers comprising the Board of Managers.

1.27 “Member(s)” shall have the meaning set forth in the Preamble.

1.28 “Merger” shall have the meaning set forth in the Recitals.

1.29 “Noncontributing Member” shall have the meaning set forth in Section 4.2(b)(i).

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1.30 “Operating Agreement” means this Amended and Restated Operating Agreement of the Company, including all schedules hereto and any and all amendments hereto entered into and effected in accordance with the terms hereof.

1.31 “Permitted Transferee” shall have the meaning set forth in Section 10.3.

1.32 “Person” means any individual, partnership, firm, corporation, limited liability company, joint-stock company, trust or other entity.

1.33 “Prior Operating Agreement” shall have the meaning set forth in the Recitals.

1.34 “Purchase Agreement” shall have the meaning set forth in the Recitals.

1.35 “Purchase Period” shall have the meaning set forth in Section 10.5(b).

1.36 “Purchase Reply” shall have the meaning set forth in Section 10.4.

1.37 “Purchase Right” shall have the meaning set forth in Section 10.5(b).

1.38 “Purchase Right Notice” shall have the meaning set forth in Section 10.5(a).

1.39 “Purchasing Member” shall have the meaning set forth in Section 10.5(b).

1.40 “Remaining Issued Units” shall have the meaning set forth in Section 10.5(e).

1.41 “Remaining Member(s)” shall have the meaning set forth in Section 10.4.

1.42 “Request” shall have the meaning set forth in Section 4.2(a).

1.43 “Sale Units” shall have the meaning set forth in Section 10.4.

1.44 “Sales Process Price” shall have the meaning set forth in Section 10.4.

1.45 “Selling Member” shall have the meaning set forth in Section 10.4.

1.46 “Tax Matters Partner” shall have the meaning set forth in Section 6.2.

1.47 “Treasury Regulations” means the Treasury Regulations, including temporary regulations, promulgated under the Code by the Internal Revenue Service.

1.48 “Units” mean the units of interest in the ownership of the Company, including with respect to the profits and losses of the Company and the right to receive distributions as a Member of the Company in accordance with the terms hereof.

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ARTICLE 2.

FORMATION

2.1 Organization. The Company has been organized as a Florida limited liability company pursuant to the provisions of the Act.

2.2 Effective Date. The Company came into being on June 30, 2009, the date on which the Articles of Organization were filed with the Florida Department of State.

2.3 Operating Agreement. Each Member, by executing this Operating Agreement, hereby agrees to the terms and conditions of this Operating Agreement, as they may from time to time be amended in accordance with the terms hereof, and to the amendment and restatement in its entirety of the Prior Operating Agreement. To the extent any provision of this Operating Agreement is prohibited or ineffective under the Act, this Operating Agreement shall be deemed to be amended to the least extent necessary in order to make this Operating Agreement effective under the Act. In the event the Act is subsequently amended or interpreted in such a way to validate any provision of this Operating Agreement that was formerly invalid, such provision shall be considered to be valid from the effective date of such amendment or interpretation.

2.4 Name. The name of the Company is Woodbridge Holdings, LLC, and the business of the Company shall be conducted under that name or under any other name selected by the Board of Managers.

2.5 Registered Agent and Office. The name and address of the registered agent for service of process shall be as set forth in the Articles of Organization. The Board of Managers may change the Company’s registered agent and office at any time.

2.6 Principal Office. The principal mailing and business office of the Company shall be at 400 East Las Olas Boulevard, Suite 800, Fort Lauderdale, Florida 33309, or such other location or address as the Board of Managers may determine from time to time.

ARTICLE 3.

PURPOSE; NATURE OF BUSINESS

3.1 Purpose; Nature of Business. The purpose of the Company shall be to engage in any lawful business that may be engaged in by a limited liability company organized under the Act. The Company shall have the authority to do all things necessary or convenient to accomplish its purpose and operate its business as described in this Section 3.1.

3.2 Powers. The Company shall have all powers of a limited liability company under the Act and the power to do all things necessary or convenient to accomplish its purpose and operate its business as described in Section 3.1.

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ARTICLE 4.

MEMBERS AND CAPITAL

4.1 Members. The name, address and number of Units held by, and the Interest and Capital Account of, each Member, is set forth on Schedule A attached hereto, as amended from time to time.

4.2 Additional Capital Contributions and Dilution.

(a) Additional Capital Contribution. No Member will be required to make any additional Capital Contributions to the Company. In the event that at any time (or from time to time) the Board of Managers determines that additional Capital Contributions are necessary, appropriate or desirable, the Board of Managers may request (the “Request”) each Member to provide an additional Capital Contribution pro rata in accordance with its Interest. The Request shall, at a minimum, describe: (i) the total amount of additional Capital Contributions from all Members then required by the Manager; (ii) a brief description of the expenses, expenditures or investments giving rise to the Request; (iii) each Member’s respective contribution amount of the total amount of additional Capital Contributions then required by the Manager; and (iv) the date (the “Call Date”) each Member’s additional Capital Contribution is required to be made (provided, however, that the Call Date shall not be less than fifteen (15) days after the Request has been given). Notwithstanding the foregoing or anything contained in this Operating Agreement to the contrary, no Request shall be binding on the Members, and no additional Capital Contributions shall be required, unless approved by the Members pursuant to Section 7.4(v). In the event of such Member approval, each Member shall contribute its respective additional Capital Contribution on or prior to the Call Date.

(b) Failure to Make an Additional Capital Contribution.

(i) Contribution of Additional Capital Contribution. In the event that a Member (the “Noncontributing Member”) fails to make such Member’s respective additional Capital Contribution on or prior to the Call Date, the other Member(s) (the “Contributing Member(s)”) may, within twenty (20) days after the Call Date, make the additional Capital Contribution that the Noncontributing Member failed to make. In the event there is more than one Contributing Member, then the Contributing Members may make the additional Capital Contribution that the Noncontributing Member failed to make pro rata in accordance with such Contributing Members’ Interests or in such other proportion as the Contributing Members may agree.

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(ii) Dilution. Additionally, whether or not the Contributing Member(s) make the additional Capital Contribution that the Noncontributing Member failed to make, the Contributing Member(s) shall have the option, exercisable by giving written notice to the Company and the Noncontributing Member within twenty (20) days after the Call Date, to treat the noncontribution of capital by the Noncontributing Member hereunder as a redistribution of the Interests between (and corresponding Units held by) the Members so that thereafter, for all purposes under this Operating Agreement, the new Interest of each Member (and corresponding Units held by each Member) after giving effect to such redistribution shall be computed as follows:

(A) the Noncontributing Member’s Interest shall equal a fraction, the numerator of which is the product of such Noncontributing Member’s Interest percentage multiplied by the Company Reference Value, and the denominator of which is the sum of the Company Reference Value plus the aggregate additional Capital Contributions made by the Contributing Member(s) with respect to the applicable Request (whether contributed with respect to such Contributing Member’s(s’) own share or the share not funded by the Noncontributing Member); and

(B) the Interests of the Contributing Member(s) shall be increased by adding thereto an aggregate amount equal to the amount by which the Interest of the Noncontributing Member has been so reduced, which amount, if there is more than one Contributing Member, shall be allocated among the Contributing Members pro rata in proportion to the relative portion of the additional Capital Contributions made by each Contributing Member with respect to the applicable Request.

The Units held by the Members shall be adjusted on the books and records of the Company to reflect such redistribution of Interests.

(iii) Exercise of Rights and Amendment of Schedule A. In the event there is more than one Contributing Member, the decision to exercise the rights of Contributing Members under this Section 4.2(b) shall be made by Contributing Members holding a majority of the Units held by the Contributing Members (prior to the redistribution contemplated by this Section 4.2(b)). The Contributing Member(s) shall send written notice of their exercise of the option under this Section 4.2(b) to the Board of Managers, the Company and the Noncontributing Member. The redistribution of Interests and Units pursuant to this Section 4.2(b) shall automatically occur effective on the date of the payment by the Contributing Members of their respective additional Capital Contributions. The Board of Managers is hereby authorized to amend Schedule A attached hereto and the books and records of the Company to reflect such redistribution of Interests and Units.

(iv) Exclusive Remedies. The remedies set forth in this Section 4.2(b) shall be the exclusive remedies available to the Company and the Contributing Member(s) for a Noncontributing Member’s failure to make an additional Capital Contribution pursuant to Section 4.2.

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4.3 Capital Accounts.

(a) Maintenance of Capital Accounts. Each Member’s Capital Account as of the date of this Operating Agreement is set forth opposite its name on Schedule A attached hereto. Each Member’s Capital Account shall be increased by: (i) the amount of such Member’s additional Capital Contributions (if any) to the Company; and (ii) the amount of any profit, income and gain allocated to such Member pursuant to the provisions hereof. Each Member’s Capital Account shall be decreased by: (i) the amount of any losses, deductions and costs allocated to such Member pursuant to the provisions hereof; and (ii) the amount of all distributions to such Member, including the fair market value of assets distributed (net of liabilities securing such distributed assets that such Member is considered to assume or take subject to).

(b) Successor to Capital Accounts. If all or a portion of the Units held by a Member is sold, assigned or otherwise transferred in accordance with the terms of this Operating Agreement, then the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred Units.

(c) Administration of Capital Accounts. This Section 4.3 and other provisions of this Operating Agreement relating to the maintenance of Capital Accounts are intended to comply with Section 704(b) of the Code and the Treasury Regulations promulgated thereunder and shall be interpreted and applied in a manner consistent with such provisions. If the Board of Managers determines that it is prudent to modify the manner in which the Capital Accounts or any charges or credits thereto are computed in order to comply with such provisions, then the Board of Managers may make such modification, but only if it is not likely to have a material effect on the amounts of distributions to any Member pursuant to Section 5.1 or pursuant to Section 11.2 upon the dissolution of the Company. Without limiting the foregoing, the Company shall revalue the assets of the Company at their then fair market value and shall adjust the Members’ Capital Accounts as necessary to comply with Treasury Regulations Sections 1.704-1(b)(2)(iv)(f) and (g), and the Members’ distributive shares of depreciation (cost recovery) and gain or loss shall thereafter be computed in accordance with Treasury Regulations Sections 1.704-1(b)(2)(iv)(f) and the principles of Section 704(c) of the Code and the regulations promulgated thereunder using the traditional method within the meaning of Treasury Regulations Section 1.704-3(b).

(d) Repayment of Capital Accounts. Notwithstanding any other provision of this Operating Agreement or applicable law to the contrary, no Member shall be required or obligated to repay to the Company, any Member or any creditor of the Company any portion or all of any deficit balance in such Member’s Capital Account.

4.4 Return of Capital Contributions. Except as otherwise provided in this Operating Agreement, no Member shall be entitled to demand the return of such Member’s Capital Account or Capital Contributions at any particular time, except upon dissolution of the Company. Except as otherwise provided in this Operating Agreement, no Member shall be entitled at any time to demand or receive assets or property other than cash. Unless otherwise provided by law, no Member shall be personally liable for the return or repayment of all or any part of any other Member’s Capital

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Account or Capital Contributions, it being expressly agreed that any such return of capital pursuant to this Operating Agreement shall be made solely from the assets (which shall not include any right of contribution from a Member) of the Company.

4.5 Loans. In the event that at any time (or from time to time) the Board of Managers determines it to be necessary, appropriate or desirable for the Company to obtain additional funds, the Board of Managers may seek loans to the Company from third parties or from any or all of the Members or their Affiliates, including loans secured by Company property, subject to any required approval of the Members under Section 7.4. None of such loans shall be deemed to be contributions of capital to the Company.

ARTICLE 5.

DISTRIBUTIONS AND ALLOCATIONS

5.1 Distributions and Allocations.

(a) Distributions. Distributions to the Members of cash or other assets of the Company will be made at such time and in such amounts as the Board of Managers may determine, subject to the approval of the Members under Section 7.4, and in any event only after the Board of Managers determines that there is sufficient cash available for distributions. Any and all such distributions will be payable to the Members pro rata in accordance with their Interests.

(b) Allocations. All items of income, gain, loss, deduction and credit shall be allocated to the Members pro rata in accordance with their Interests.

5.2 Special Allocations.

(a) Losses. Losses allocated to any Member pursuant to Section 5.1 shall not exceed the maximum amount of losses that can be so allocated without causing the Capital Account of such Member to have a deficit Capital Account balance which is in excess of the amount such Member is deemed to be obligated to restore pursuant to the penultimate sentences of Sections 1.704-2(g)(1) and 1.704-2(i)(5) of the Treasury Regulations.

(b) Qualified Income Offset. In the event any Member unexpectedly receives any adjustments, allocations or distributions described in Treasury Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6) causing an adjusted capital account deficit, items of Company income and gain shall be specially allocated to each such Member in an amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations, the adjusted capital account deficit of such Member as quickly as possible.

(c) Code Section 704(c). In accordance with Section 704(c) of the Code and the Treasury Regulations promulgated thereunder, income, gain, loss and deduction with respect to any property contributed, or deemed to be contributed, to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such property to the Company for federal income tax purposes and its fair market value.

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(d) Curative Allocations. The allocation method set forth in this Article 5 is intended to allocate profits, losses, income, gain, deduction and credit to the Members for federal income tax purposes in accordance with their economic interests in the Company while complying with the principles of Sections 704(b), 704(c) and 752 of the Code and the Treasury Regulations promulgated thereunder. If in the opinion of the Board of Managers, the allocation of profits, losses, income, gain, deduction and credit pursuant to the provisions of this Article 5 shall not (i) satisfy the requirements of Sections 704(b), 704(c) and/or 752 of the Code or the Treasury Regulations promulgated thereunder, (ii) comply with any other provisions of the Code or Treasury Regulations, or (iii) properly take into account any expenditure made by the Company or any transfer of a Unit, then, notwithstanding anything to the contrary contained in the preceding provisions of this Article 5, profits, losses, income, gain, deduction and credit shall be allocated in such manner as the Board of Managers shall reasonably determine to be required so as to reflect properly (i), (ii) or (iii), as the case may be, and this Operating Agreement shall be amended without any action on the part of the Members to reflect any such change in the method of allocating profits, losses, income, gain, deduction and credit; provided, however, that any change in the method of allocating profits, losses, income, gain, deduction and credit shall not materially alter the economic agreement between the Members.

ARTICLE 6.

TAXATION

6.1 Income Tax Reporting. Each Member is aware of the income tax consequences of the allocations made by Article 5 and hereby agrees to be bound by the provisions of Article 5 in reporting such Member’s share of Company income and loss for federal and state income tax purposes.

6.2 Tax Matters Partner. BFC or its designee shall be the “tax matters partner” of the Company pursuant to Section 6231(a)(7) of the Code (the “Tax Matters Partner”). The Tax Matters Partner shall be authorized and required to represent the Company (at the expense of the Company) in connection with all examinations of the affairs of the Company by any federal, state or local tax authorities, including any resulting administrative and judicial proceedings, and to expend funds of the Company for professional services and costs associated therewith. The Tax Matters Partner shall take all actions necessary to preserve the rights of the Members with respect to audits and shall provide all Members with notices of all such proceedings and other information as required by law. The Tax Matters Partner may prepare and file protests or other appropriate responses to such audits. The Tax Matters Partner shall select counsel to represent the Company in connection with any audit conducted by the Internal Revenue Service or by any state or local authority. All costs incurred in connection with the foregoing activities, including legal and accounting costs, shall be borne by the Company. The Tax Matters Partner shall keep the Members timely informed of its activities under this Section 6.2. Each Member agrees to cooperate with the Tax Matters Partner in connection with the conduct of all such proceedings.

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6.3 Election to be Taxed as Association. The Company shall be treated as a partnership for federal and state income tax purposes. No Member shall cause the Company to elect to be treated as a corporation for federal or state income tax purposes, unless such election is approved in writing by all of the Members.

ARTICLE 7.

RIGHTS, POWER AND AUTHORITY

OF THE BOARD OF MANAGERS AND THE MEMBERS

7.1 Composition of the Board of Managers. The Board of Managers shall initially be comprised of three Managers, who shall be Alan B. Levan, John E. Abdo and Seth M. Wise. Any Manager may be replaced and successor Managers may be appointed at any time upon the approval of a Majority-in-Interest of the Members.

7.2 Authority of and Actions by the Board of Managers. Except as expressly set forth to the contrary in this Operating Agreement, the Board of Managers shall have the full and exclusive right, power and authority to manage the affairs of the Company and to bind the Company, to make all decisions with respect thereto and to do or cause to be done any and all acts or things deemed to be necessary, appropriate or desirable to carry out or further the business of the Company. The Board of Managers shall act (i) at a meeting of the Board of Managers, by resolution duly adopted by a majority of the Managers or (ii) without a meeting of the Board of Managers, by written consent signed by a majority of the Managers.

7.3 Duties of the Managers. Each Manager shall perform his duties in good faith, in a manner he reasonably believes to be in the best interests of the Company and with such care as an ordinarily prudent person in a like position would use under similar circumstances. In performing his duties, each Manager shall be entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, in each case, prepared and presented by one or more agents or employees of the Company whom the Manager reasonably believes to be reliable and competent in the matters presented or counsel, public accountants or other Persons as to matters which the Manager reasonably believes to be within such Person’s professional or expert competence. No Manager shall be liable for actions taken as a manager of the Company, or for a failure to take actions, if he performed his duties in compliance with this Section 7.3.

7.4 Action by the Members. Except as expressly set forth to the contrary herein, the Members shall have no right, power or authority to manage the affairs of the Company or to bind the Company or to make any decisions with respect thereto. Notwithstanding the foregoing and anything to the contrary contained herein, the Company shall not take any of the following actions (each a “Major Decision”) without the prior written consent of all of the Members:

(i) initiate any reorganization or similar transaction involving the Company or any filing by the Company for relief as a debtor under any bankruptcy, insolvency, reorganization or similar law, any application by the Company for the appointment of a receiver, trustee, custodian or similar fiduciary for a substantial portion of the assets of the Company or the consent by the Company to any petition or application seeking similar relief which is filed against the Company;

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(ii) merge or consolidate the Company with, or cause the Company to acquire substantially all of the securities or assets of, any other Person, unless in the case of a merger or consolidation the Members of the Company immediately prior to such transaction own equity of the Person that results from or survives such transaction, directly or indirectly, in the same proportion and with the same relative rights as they did prior to such transaction;

(iii) sell, assign or otherwise transfer any portion of the Company’s equity interest in Bluegreen, or all or substantially all of the assets of the Company;

(iv) amend the Articles of Organization or, except as expressly set forth herein, this Operating Agreement;

(v) issue or sell, or authorize for issuance or sale, any additional Units or other membership interests in the Company or equity interests in Bluegreen, cause the Company to enter into any agreement or commitment of any character obligating the Company to issue or sell any such membership or equity interests, or require the Members to make any additional Capital Contributions to the Company;

(vi) redeem, purchase or otherwise acquire, directly or indirectly, any Units or other membership interests in the Company or any right to purchase or acquire any such membership interests;

(vii) declare or pay any dividend or distribution, whether in cash, securities or other property;

(viii) incur, assume or become subject to any indebtedness for borrowed money in a principal amount greater than $500,000;

(ix) pledge, mortgage, hypothecate or otherwise encumber assets having an aggregate carrying value, as reported on the Company’s most recent balance sheet, greater than $500,000 other than in connection with indebtedness the incurrence of which does not require consent pursuant to the preceding clause (viii);

(x) guarantee any indebtedness of a third party;

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(xi) materially change the Company’s principal business, which on the date of this Operating Agreement consists of engaging in those activities related to the Company’s ownership of Bluegreen;

(xii) make or commit to make any capital expenditure requiring payments in the aggregate in excess of $500,000 in any fiscal year, or enter into any contracts, agreements or other arrangements involving payments in the aggregate in excess of $1,000,000 in any fiscal year, in each case other than in connection with: (A) indebtedness of the Company the incurrence of which does not require consent pursuant to clause (viii); or (B) the pledge, mortgage, hypothecation or other encumbrance of assets of the Company which does not require consent pursuant to clause (ix);

(xiii) enter into any contract, agreement or other arrangement with a Member or an Affiliate of a Member (other than Bluegreen) involving payments in the aggregate in excess of $250,000 in any fiscal year;

(xiv) take any action which requires the consent or approval of the Company, as the holder of Bluegreen’s common stock, under Bluegreen’s Articles of Organization or Bylaws or applicable law;

(xv) make any other decision or take any other action which by the provisions of this Operating Agreement is required to be approved by the Members.

The Company shall promptly provide the Members with a written request for consent to any Major Decision, which written consent request shall set forth the material terms of the action with respect to which the Members’ consent is sought. The Members shall submit any such written request to its respective Board of Directors (or Persons holding similar authority in the case of Members which are entities other than corporations or to any committee thereof established or designated to act thereon). The act of each Member’s Board of Directors (or Persons holding similar authority in the case of Members which are entities other than corporations) or committee thereof shall be the act of the Member with respect to the consent request. Each Member shall provide written notice to the Board of Managers of its approval or disapproval of the applicable Major Decision within fifteen (15) days after the date of such Member’s receipt of the written consent request.

7.5 Delegation of Authority to Officers. The Board of Managers may delegate such general or specific authority to the officers of the Company as it may from time to time consider desirable, and the officers of the Company may, subject to any restraints or limitations imposed by the Board of Managers, exercise any authority granted to them.

7.6 Limitations on Powers of Members. Except as expressly authorized by this Operating Agreement, no Member shall, directly or indirectly, (a) resign, retire or withdraw from the Company, (b) dissolve, terminate or liquidate the Company, (c) petition a court for the dissolution, termination or liquidation of the Company or (d) cause any property of the Company to be subject to the authority of any court, trustee or receiver (including suits for partition and bankruptcy, insolvency and similar proceedings).

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ARTICLE 8.

OFFICERS

8.1 Officers. The Company may have a President, a Secretary, a Treasurer and one or more Vice-Presidents and such other officers and assistant officers and agents of the Company as may be deemed desirable by the Board of Managers. No officer shall be deemed a “manager” of the Company as such term is defined in this Operating Agreement or in the Act. Any two or more offices may be held by the same individual. All officers shall serve until their respective successors are appointed by the Board of Managers and qualified. The following persons shall serve as the initial officers of the Company for a term of one (1) year and until their successors are duly appointed by the Board of Managers and qualified:


President:		Alan B. Levan
Vice-President:		John E. Abdo
Vice-President:		Jarett S. Levan
Secretary:		Linda M. Drapos
Treasurer:		John K. Grelle

8.2 Duties of Officers.

(a) President. The President shall be the chief executive officer and shall have such duties and powers, subject to the control of the Board of Managers, that are customary for a chief executive officer of a company that is engaged in a similar business as the Company and shall do and perform such acts as the Board of Managers may, from time to time, authorize him to do.

(b) Vice-President. The Vice-President shall have such duties and powers, subject to the control of the President and the Board of Managers, that generally pertain to their offices, and shall do and perform such other acts as the Board of Managers or the President may, from time to time, authorize him to do.

(c) Secretary. The Secretary shall take the minutes of all meetings of the Members and may sign, execute and deliver such documents and instruments as may be appropriately signed and executed in the name of the Company by a Secretary. The Secretary shall give, or cause to be given, notice of all meetings of the Members and shall perform such other duties as may be prescribed by the Board of Managers or the President.

(d) Treasurer. The Treasurer shall act under the direction of the Board of Managers and the President. Subject to the control of the Board of Managers and the President, the Treasurer shall have custody of the Company’s funds and securities and shall keep or cause to be kept full and accurate accounts of receipts and disbursements in books belonging to the Company

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and shall deposit or cause to be deposited all moneys and other valuable effects in the name and to the credit of the Company in such depositories as may be designated by the Board of Managers. The Treasurer shall disburse, or cause to be disbursed, the funds of the Company as may be ordered by the Board of Managers (subject, if applicable, to any required approval of the Members), taking proper vouchers for such disbursements, and shall render when the Board of Managers so require, an account of all transactions as Treasurer and of the financial condition of the Company.

8.3 Removal. Any officer of the Company may be removed, with or without cause, by the Board of Managers.

8.4 Resignation. Any officer of the Company may resign upon written notice made to the Board of Managers. Any such written notice of resignation shall be effective upon receipt thereof by the Board of Managers.

8.5 Vacancies. Any vacancy occurring among the officers of the Company may be filled by the Board of Managers. A person elected to fill a vacancy shall hold office only until the next annual appointment by the Board of Managers and until his successor shall have been duly appointed by the Board of Managers and qualified.

ARTICLE 9.

MEETINGS OF THE MEMBERS

9.1 Meetings of the Members. An annual meeting of the Members may be held at a time and place designated by the Board of Managers. Special meetings of the Members shall be held when requested by the Board of Managers or by a Majority-in-Interest of the Members. A meeting shall be called for a date not less than one nor more than fifty days after the request is made, unless the Members requesting the meeting designate a later date. The call for the meeting shall be issued by the Secretary, unless the Members requesting the meeting shall designate another person to do so. Written notice stating the place, date, hour and the purpose or purposes for which the meeting is called shall be delivered to all of the Members not less than one nor more than forty-five days before the meeting, by or at the direction of the Secretary or such Members requesting the meeting.

9.2 Place. Meetings of the Members may be held within or without the State of Florida. The Members may participate in a meeting of the Members by conference telephone or similar communications equipment in which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this Section 9.2 shall constitute presence in person at such meeting of the Members.

9.3 Member Quorum and Voting. The attendance at a meeting of a Majority-in-Interest of the Members shall constitute a quorum at such meeting. The affirmative vote of a Majority-in-Interest of the Members shall be the act of the Members unless otherwise provided by the Act or other applicable law, by the Articles of Organization or by this Operating Agreement.

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9.4 Proxies. Each Member may authorize another Person or Persons to act for such Member by proxy. Every proxy must be signed by the Member or its attorney-in-fact. No proxy shall be valid after the expiration of eleven months from the date thereof unless otherwise provided in such proxy. Every proxy shall be revocable at the pleasure of the Member, except as otherwise required by the Act or other applicable law.

9.5 Action by Written Consent of the Members in Lieu of a Meeting. Any action required by the Act or other applicable law, by the Articles of Organization or by this Operating Agreement to be taken at any meeting of the Members or any action which may be taken at any meeting of the Members may be taken without a meeting and without notice by written consent signed by Members holding Units representing the percentage of outstanding Units required to approve such action if taken at a meeting of Members where all Members were present and voting unless otherwise provided by the Act or other applicable law, by the Articles of Organization or by this Operating Agreement.

ARTICLE 10.

TRANSFER OF UNITS;

ADMISSION OF ADDITIONAL MEMBERS

10.1 Restrictions on Transfer. Each Member agrees that such Member will not, directly or indirectly and whether by operation of law or otherwise, exchange, sell, bequeath, pledge, mortgage, hypothecate, encumber, distribute, transfer, give, assign or in any other manner whatsoever dispose or attempt to dispose of (each of the forgoing, when used as a noun, being a “Disposition,” and when used as a verb, to “Dispose”) all or any portion of the Units held by such Member at any time, other than a Disposition made or solicited in compliance with the procedures, and subject to the limitations, set forth in this Article 10. Any attempted Disposition of Units not in compliance with this Article 10 shall be null and void and the intended transferee shall be deemed never to have had any interest of any nature whatsoever therein. Nothing contained in this Section 10 or otherwise in this Operating Agreement shall be deemed to restrict the redistribution of Interests and Units pursuant to Section 4.2, or to restrict or limit the Disposition of any equity interests or other securities of a Member or an Affiliate of a Member which has a class of equity securities registered under Section 12 of the Securities Exchange Act of 1934.

10.2 Effect of Transfer. In the event of any Disposition permitted under this Operating Agreement, the Company shall not be dissolved or wound up. No Disposition shall relieve the assignor from any of its obligations under this Operating Agreement arising prior to such Disposition (it being understood that, except as otherwise provided herein, the assignor may be relieved of such obligations to the extent the same arise after such Disposition and the same are assumed in writing by the transferee). Additionally, notwithstanding anything to the contrary contained in this Operating Agreement, as a condition precedent to any Disposition by a Member and the transferee being admitted as a Member, the transferee (including a Permitted Transferee) must execute a counterpart to this Operating Agreement in form and substance acceptable to the Board of Managers and agree to be bound by all of the terms and provisions hereof.

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10.3 Certain Permitted Transfers. Any Member may Dispose of his or her Units, in whole or in part, to any Controlled Affiliate of such Member (a “Permitted Transferee”), and such Permitted Transferee shall be admitted as a Member, subject to the terms and conditions of this Operating Agreement.

10.4 Member Sale and Purchase of Units. If any Member (a “Selling Member”) desires to Dispose of all, but not less than all, of such Member’s Units or that the Company sell Bluegreen, whether through an equity or asset Disposition, or a merger, consolidation or other similar strategic transaction involving Bluegreen, then the Selling Member shall provide written notice (the “Sales Notice”) of such decision to the other Member(s) (the “Remaining Member(s)”). Within thirty days after its receipt of the Sales Notice, each Remaining Member shall notify the Selling Member in writing (the “Purchase Reply”) whether such Remaining Member desires to purchase the Selling Member’s Units (collectively, the “Sale Units”). If one or more of the Remaining Members desire to purchase the Sale Units, then promptly after delivery of the Purchase Reply, the Selling Member and the applicable Remaining Member(s) shall negotiate in good faith with respect to the purchase of the Sale Units by the applicable Remaining Member(s). If the Selling Members and the applicable Remaining Member(s) agree upon the terms and conditions for the purchase and sale of the Sale Units, then the purchase and sale of the Sale Units shall be consummated in accordance with such agreed upon terms and conditions. If, despite such good faith negotiations, the price and other terms of the purchase and sale of the Sale Units are not agreed upon by the Selling Member and the applicable Remaining Member(s) within ninety days after the Selling Member’s receipt of the Purchase Reply (or such additional period(s) of time as may be mutually agreed upon by the Selling Member and the applicable Remaining Member(s)), then (a) the Selling Member shall within five days after the end of such ninety day period (or any agreed upon extension thereof) specify in a writing delivered to the Remaining Member(s) the lowest cash price for which it is willing to sell the Sale Units (the “Final Offer Price”), and (b) the Members shall engage an investment banking firm to market the Company (or, if applicable, Bluegreen) for sale and pursue and consummate a sale of the Company or Bluegreen, as the case may be; provided, however, that if the net proceeds that would be received by the Selling Member with respect to the Sale Units as a result of a sale of the Company or Bluegreen, as the case may be, pursuant to the sales process undertaken by the investment banking firm (the “Sales Process Price”) is equal to or less than the Final Offer Price, then the applicable Remaining Member(s) shall have the option, exercisable in its (or their, as the case may be) sole discretion upon written notice delivered to the Selling Member within ten days after the determination of the Sales Process Price, to purchase the Sale Units from the Selling Member at the Sales Process Price. In the event that the transaction resulting from the sales process is a sale of Bluegreen, then the Sales Process Price shall be the net proceeds that would be received by the Selling Member with respect to the Sale Units upon the receipt by the Company of the net proceeds from the sale of Bluegreen followed immediately thereafter by a liquidation of the Company in accordance with Article 11 hereof. If none of the Remaining Members desire to purchase the Sale Units, or if the Selling Member and the Remaining Member(s) had agreed upon the terms and conditions for the purchase and sale of the Sale Units but such transaction failed to close due to either a breach by the Remaining Member(s) or the failure to satisfy a condition that was the responsibility of the Remaining Member(s) to satisfy, then the Members shall engage an

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investment banking firm to market the Company (or, if applicable, Bluegreen) for sale and pursue and consummate a sale of the Company or Bluegreen, as the case may be, as soon as reasonably practicable. If the Selling Member and the Remaining Member(s) had agreed upon the terms and conditions for the purchase and sale of the Sale Units but such transaction failed to close due to either a breach by the Selling Member or the failure to satisfy a condition that was the responsibility of the Selling Member to satisfy, then the Selling Member shall be prohibited from delivering a Sales Notice and initiating the sales process set forth in this Section 10.4 for a period of two years from the date of the definitive agreement entered into in connection with such terminated transaction. In the event there is more than one Remaining Member, the Remaining Members may acquire the Sale Units, and pay the purchase price therefor, pro rata in accordance with such Remaining Members’ Interests or in such other proportion as the Remaining Members may agree. The Members each agree to cooperate in good faith to facilitate any third party sale transaction resulting from the investment banking sale process described above, including (i) by making information concerning the Company and Bluegreen reasonably available for customary due diligence and (ii) by negotiating and executing a definitive purchase agreement and other related agreements containing representations, warranties, covenants and other relevant provisions that are reasonable and customary for such a transaction.

10.5 Preemptive Rights.

(a) If the Company proposes to issue or sell any Units (including any securities exchangeable or exercisable for, or convertible into, Units), which proposal has been approved by the Board of Managers and Members of the Company pursuant to the provisions hereof, the Company shall first deliver written notice of its proposal to do so (the “Purchase Right Notice”) to each of the Members. The Purchase Right Notice must: (i) identify the name and address of each Person (if known) to which the Company proposes to issue or sell the Units, (ii) specify the number of Units that the Company proposes to issue or sell (the “Issued Units”), (iii) describe the consideration per Unit for the Issued Units (expressed as a value in cash, the “Issued Price”), (iv) describe the material terms and conditions upon which the Company proposes to issue or sell the Issued Units (the “Issued Terms”), and (v) irrevocably offer to issue or sell to each Member any number of Issued Units up to a pro rata portion of the Issued Units, based on the Member’s then-current Interest in the Company, for the Issued Price and on the Issued Terms and in accordance with this Section 10.5.

(b) Each Member shall have an option, exercisable for a period of 30 days from the date of delivery of the Purchase Right Notice (the “Purchase Period”), to purchase any number of Issued Units up to a pro rata portion of the Issued Units, based on the Member’s then current Interest in the Company, for the Issued Price and on the Issued Terms (the “Purchase Right”). The Purchase Right shall be exercised by delivery by such Member (a “Purchasing Member”) of written notice to the Board of Managers, which shall state the number of Issued Units to be purchased by such Member. Any written notice delivered by a Purchasing Member to the Company exercising the option set forth under this Section 10.5(b) shall constitute an irrevocable commitment by such Purchasing Member to purchase the number of Issued Units specified in such written notice in accordance with the Purchase Right Notice and this Section 10.5.

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(c) If a Member does not exercise its Purchase Right during the Purchase Period, then such Member’s Purchase Right with respect to such Issued Units shall terminate.

(d) Each Purchasing Member shall purchase from the Company, and the Company shall issue or sell to such Purchasing Member, the number of Issued Units that such Purchasing Member elected to purchase in accordance with this Section 10.5 for the Issued Price and on the Issued Terms on (i) the date of the closing of the issuance of the Issued Units described in the Purchase Right Notice delivered by the Company pursuant to Section 10.5(a) or (ii) such other date as may be agreed in writing by the Company and such Purchasing Member. Notwithstanding anything to the contrary herein, if the consideration per Unit for the Issued Units is other than for all cash, the Purchase Right hereunder may be exercisable in cash at the fair market value of the securities or other property that constitute such consideration, with such fair market value to be mutually agreed upon by the Company and the applicable Purchasing Member(s) or, in the case of any dispute as to the fair market value, by a nationally recognized, independent certified public accounting firm chosen by the Board of Managers that has no material business relationship with the Company or the applicable Purchasing Member(s), or as the Company and the applicable Purchasing Member(s) may otherwise agree.

(e) Upon the earlier of (i) the expiration of the Purchase Period and (ii) delivery of written notices to the Company from all the Members indicating their intent, in the aggregate, to purchase less than all of the Issued Units (the date of such earlier occurrence, the “Ending Date”), the Company shall have the right, exercisable for a period of 120 days from the Ending Date (the “Issuance Period”), to issue or sell all or a portion of the Issued Units that the Members have elected not to purchase (the “Remaining Issued Units”) to any Person for a price per Unit that is not less than the Issued Price and on terms and conditions that are not more favorable to such other Person than the Issued Terms; provided that (i) the Company shall be deemed to have issued or sold the Remaining Issued Units during the Issuance Period if, during the Issuance Period, the Company has irrevocably entered into a bona fide binding agreement to issue or sell the Remaining Issued Units to any Person and (ii) the closing of the issuance or sale occurs within 60 days after the full execution of such bona fide binding agreement. If the Company wishes to issue or sell the Remaining Issued Units for a price per Unit that is less than the Issued Price or on terms and conditions that are more favorable to the purchaser than the Issued Terms, or if the Company wishes to issue or sell the Remaining Issued Units following the expiration of the Issuance Period, the Company shall be required to first comply with this Section 10.5 anew.

(f) Notwithstanding anything to the contrary contained herein, the Purchase Rights established by this Section 10.5 shall not be applicable to any Unit split, dividend or division, or a recapitalization by the Company, pursuant to which all holders of Units are treated similarly.

10.6 Additional Members. As a condition precedent to a Person being admitted as an additional or new Member of the Company (following compliance with the applicable provisions of

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this Article 10), such Person must execute a counterpart to this Operating Agreement in form and substance acceptable to the Board of Managers and agree to be bound by all of the terms and provisions hereof.

ARTICLE 11.

DISSOLUTION AND WINDING UP

11.1 Events of Dissolution. The Company shall be dissolved upon the first to occur of (a) the written consent of all of the Members and (b) the entry of a decree of judicial dissolution under the Act.

11.2 Winding Up.

(a) Manner of Winding Up. In the event of the dissolution of the Company for any reason, the Board of Managers shall commence to wind up the affairs of the Company and to liquidate its investments. The Board of Managers shall prepare a plan, method or procedure for the orderly winding up of the Company. Any proceeds from liquidation, together with any assets which the Board of Managers determines to distribute in kind, shall be applied in the following order:

(i) First, the expenses of liquidation and the debts of the Company, including any debts and expenses of the Company to any Member as permitted by this Operating Agreement. Any reserves shall be established or continued which the Board of Managers deems reasonably necessary for any contingent or unforeseen liabilities or obligations of the Company arising out of or in connection with the Company or its liquidation. Such reserves shall be held by the Company for the purpose of disbursement in payment of any of the aforementioned contingencies; and

(ii) Second, at the expiration of such period as the Board of Managers deems advisable, the Company shall distribute the balance thereafter remaining in accordance with Section 5.1(a).

(b) Administration of Winding Up. This Section 11.2 is intended to comply with the provisions of Section 704(b) of the Code and the Treasury Regulations promulgated thereunder, and shall be interpreted and applied in a manner consistent with such provisions. Any assets of the Company to be distributed in kind shall be distributed on the basis of the fair market value thereof and may be distributed to any Member entitled to any interest in such assets as a tenant-in-common with all other Members so entitled.

11.3 Termination and Cancellation. Upon the completion of the liquidation of the Company and the distribution of all Company funds, the Company shall terminate and the Board of Managers shall have the authority to execute and deliver Articles of Dissolution of the Company as well as any and all other documents required to effectuate the dissolution and termination of the Company.

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ARTICLE 12.

ADMINISTRATION

12.1 Books and Records. The Board of Managers shall keep, or cause to be kept, at the principal place of business of the Company true and correct books of account, in which shall be entered fully and accurately each and every transaction of the Company. Each Member or its designated agent shall have access at reasonable times on business days at the Company’s office to inspect the Company’s books of account and records and all other information concerning the Company required by the Act to be made available to the Members, and may make copies thereof at such Member’s expense. For accounting and income tax purposes, the Company’s books of account shall be kept in accordance with accounting principles selected by the Board of Managers, consistently applied, and for a fiscal period which is the calendar year.

12.2 Banking. All funds of the Company shall be deposited in its name in such federally-insured commercial bank or banks or invested in such federally-insured savings and loan account or accounts, in such U.S. Treasury obligations, or in such bank certificates of deposit, or in other accounts or financial instruments as the Board of Managers may decide. All funds of the Company shall only be used for Company purposes or distributed to the Members as provided in this Operating Agreement and in accordance with the terms of this Operating Agreement.

12.3 Reporting Requirements. The Board of Managers shall use commercially reasonable best efforts to cause to be delivered to the Members: (a) unaudited financial statements for each completed fiscal year, promptly after such unaudited financial statements are available and in any event within 60 days after the end of such completed fiscal year; (b) unaudited financial statements for each completed quarterly period of a fiscal year, promptly after such unaudited financial statements are available and in any event within 30 days after the end of such completed fiscal quarterly period; and (c) following the end of each fiscal year, such information concerning the Company as shall be necessary for the preparation by a Member of such Member’s income tax or other tax returns. The Company acknowledges and agrees that each of the Members has reporting obligations pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934, that each Member is responsible for its own accounting and reporting obligations under the Securities Act of 1933 and the Securities Exchange Act of 1934, and that the Company will cooperate with each Member and provide access and information as reasonably necessary to permit each Member to timely prepare its audited financial statements and to comply with its legal and regulatory obligations, including reporting obligations under the Securities Act of 1933 and the Securities Exchange Act of 1934.

12.4 Accounting Decisions; Tax Elections. All decisions as to accounting matters and tax elections, except as specifically provided to the contrary in this Operating Agreement, shall be made by the Board of Managers. The Board of Managers may rely upon the advice of the Company’s accountants and professional advisors in making such decisions.

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ARTICLE 13.

LIMITATION OF LIABILITY; INDEMNIFICATION

13.1 Limited Liability. Except as otherwise provided by the Act, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company. The Managers and the Members shall not be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a manager or member of the Company, as the case may be. The failure of the Company to observe any formalities or requirements relating to the exercise of its powers or the management of its business or affairs under this Operating Agreement or the Act shall not be grounds for imposing personal liability on the Members for any debts, liabilities or obligations of the Company. Except as otherwise expressly required by the Act or other applicable law, each Member, in such Member’s capacity as such, shall have no liability in excess of (a) the amount of such Member’s net Capital Contributions, (b) such Member’s share of any assets and undistributed profits of the Company and (c) the amount of any distributions required to be returned pursuant to the Act.

13.2 Indemnification. The Company (including any receiver or trustee of the Company) shall, to the fullest extent provided or allowed by the Act and other applicable law, indemnify, save harmless and pay all judgments and claims against the Managers, the officers of the Company, the Members and the Members’ respective agents, Affiliates, heirs, legal or personal representatives, successors and permitted assigns (each, an “Indemnified Party”) from, against and in respect of any and all liability, loss, damage and expense incurred or sustained by the Indemnified Party in connection with the business of the Company or by reason of any act performed or omitted to be performed in connection with the activities of the Company or in dealing with third parties on behalf of the Company, including, without limitation, costs and attorneys’ fees before and at trial and at all appellate levels, whether or not suit is instituted (which attorneys’ fees may be paid as incurred), and any amounts expended in the settlement of any claims of liability, loss or damage, provided that the act or omission of the Indemnified Party does not constitute fraud or willful misconduct by such Indemnified Party.

13.3 Insurance. The Company shall not pay for any insurance covering liability of the Managers, the officers of the Company, the Members or any Member’s agents, Affiliates, heirs, legal or personal representatives, successors or permitted assigns for actions or omissions for which indemnification is not permitted under this Operating Agreement; provided, however, that nothing contained herein shall preclude the Company from purchasing and paying for such types of insurance, including, without limitation, directors and officers liability, extended coverage liability and casualty and worker’s compensation, as would be customary for any Person owning, managing and/or operating comparable assets and property and engaged in a similar business or from naming the Managers, the officers of the Company, the Members and any Member’s agents, Affiliates, heirs, legal or personal representatives, successors or permitted assigns or any Indemnified Party as additional insured parties thereunder.

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13.4 Non-Exclusive Right. The provisions of this Article 13 shall be in addition to and not in limitation of any other rights of indemnification and reimbursement or limitations of liability to which an Indemnified Party may be entitled under the Act, common law or otherwise. Notwithstanding any repeal of this Article 13 or other amendment hereof, its provisions shall be binding upon the Company (subject only to the exceptions above set forth) as to any claim, loss, expense, liability, action or damage due to or arising out of matters which occur during or relate to the period prior to any such repeal or amendment of this Article 13.

ARTICLE 14.

AMENDMENT

14.1 Amendment. Except as otherwise provided herein, this Operating Agreement may not be amended, altered or modified except upon the approval of the Board of Managers and all of the Members.

ARTICLE 15.

MISCELLANEOUS

15.1 Binding Effect. Except as otherwise provided to the contrary herein, this Operating Agreement shall be binding upon and inure to the benefit of the undersigned, their legal or personal representatives, heirs, successors and permitted assigns.

15.2 Applicable Laws. This Operating Agreement and the rights and duties of the Members hereunder shall be governed by, and interpreted and construed in accordance with, the laws of the State of Florida.

15.3 Counterparts. This Operating Agreement may be executed in several counterparts, and all so executed shall constitute one Operating Agreement binding on all of the Members hereto, notwithstanding that all of the parties are not signatory to the original or the same counterpart.

15.4 Provisions Severable. In the event any sentence, paragraph, provision, word, section or article of this Operating Agreement is declared by a court of competent jurisdiction to be void, such sentence, paragraph, provision, word, section or article shall be deemed severed from the remainder of this Operating Agreement and the balance of this Operating Agreement shall remain in effect.

15.5 Waiver. Any waiver by any party hereto of any of its rights or remedies under this Operating Agreement or of any breach or violation of or default under this Operating Agreement must be in writing and signed by the party to be charged thereunder and shall not constitute a waiver of any of its other rights or remedies or of any other or future breach, violation or default hereunder.

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15.6 Equitable Remedies. The Company and the Members shall be entitled to all available legal and equitable remedies against each other, and recovery of all damages or losses of the Company caused by any Member’s breach or violation of, or default under, this Operating Agreement.

15.7 Notice. All approvals, consents, notices, requests, demands and other communications under this Operating Agreement shall be in writing and shall be deemed to have been duly received (a) upon receipt if delivered by hand delivery, (b) on the day confirmation is received of the recipient’s facsimile number if delivered by facsimile, (c) on the first business day after delivery to a nationally recognized overnight courier service for next business day delivery or (d) on the third business day after depositing into the U.S. mail if sent by certified mail, return receipt requested, postage prepaid, in each case, to the addresses or facsimile numbers of the Members set forth on Schedule A attached hereto.

15.8 Headings. The article and section headings in this Operating Agreement are inserted as a matter of convenience and are for reference only and shall not be construed to define, limit, extend or describe the scope of this Operating Agreement or the intent of any provision.

15.9 Number and Gender. Whenever required by the context hereof, the singular shall include the plural, and vice versa and the masculine gender shall include the feminine and neuter genders, and vice versa.

15.10 Independent Representation. Each Member acknowledges and represents that it has been advised to seek, and has been represented by, independent legal counsel and financial and tax advisors in connection with the negotiation, preparation and execution of this Operating Agreement.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, this Operating Agreement has been made and executed by the Members effective as of the date first written above.


BFC FINANCIAL CORPORATION,
a Florida corporation

By:		/s/ Seth M. Wise
Name:		Seth M. Wise
Title:		Executive Vice President

BBX CAPITAL CORPORATION,
a Florida corporation

By:		/s/ John K. Grelle
Name:		John K. Grelle
Title:		Executive Vice President and Chief Financial Officer

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SCHEDULE A


Name of Member	Address and Facsimile Number	Units		Interest			Capital Account

BFC Financial Corporation	401 East Las Olas Blvd. Suite 800 Fort Lauderdale, FL 33301 Fax: (954) 940-5050		54		54	%	$84,228,260

BBX Capital Corporation	401 East Las Olas Blvd. Suite 800 Fort Lauderdale, FL 33301 Fax: (954) 940-5050		46		46	%	$71,750,000