PwC served as the independent registered certified accounting firm for the Company, BankAtlantic Bancorp and Levitt for 20032005 and 2004. The following table presents for each of these entities (i) fees for professional services renderedbilled by PwC forrelating to the audit of each of the company’s annual financial statements for fiscal 20042005 and 20032004 and fees billed by PwC for audit-related services, tax services and all other services rendered by PwC for fiscal 20042005 and 2003.2004.
Audit Committee meeting. Engagements involving projected fees of more than $10,000 may only be pre-approved by the full Audit Committee at a regular or special meeting.
The Audit Committee has determined that the provision of the services, other than audit services, as described above are compatible with maintaining the principal independent auditor’s independence.
2) PROPOSAL TO APPROVE THE COMPANY’S 2005 STOCK INCENTIVE PLAN
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2) | PROPOSAL TO APPROVE THE COMPANY’S 2006 PERFORMANCE-BASED ANNUAL INCENTIVE PLAN |
The Company’sIn March 2006, our Compensation Committee of the Board of Directors has adopted the BFC Financial Corporation 2005 Stock2006 Performance-Based Annual Incentive Plan, subject to approval by its shareholders. ProvidedPlan. We have provided below is a summary of the Company’splan and our reasons for adopting this plan and seeking the approval of itsour shareholders. The following summary is qualified in its entirety by the full text of the plan document. The plan document which is included at the end of this Proxy Statementproxy statement inAppendix A and is incorporated by reference into this proposal.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR”FOR THE APPROVAL OF THE BFC FINANCIAL CORPORATION 2005 STOCK2006 PERFORMANCE-BASED ANNUAL INCENTIVE PLAN.
Purpose of the Stock Incentive Plan
The purpose of the plan is to advance the interests of the Company and its shareholders by providing certain of the Company key executives with annual incentive compensation which is tied to the achievement of pre-established and objective performance goals, to attract and retain the best available personnel for positions of substantial responsibility at the Company, to provide additional long term incentives to the employees of the Company and its subsidiaries as well as other individuals who perform services for the Company and its subsidiaries,company and to promote the success and profitability of the Company’s business. If thisThe plan is approved by shareholders, restricted stock and options will be available for issuance under this plan andintended to ensure that the Company will not issue any additional restricted stock or optionsannual incentive compensation paid to key executives under the Company’s existing stock option plans.
Descriptionplan is not subject to the deduction limitations under Section 162(m) of the Stock Incentive PlanCode.
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| TypesDescription of Awardsthe Plan |
The plan allows the Company to grant stock options (both incentive stock options and non-qualified stock options) and restricted stock. In the past, stock options were the principal form of long-term equity incentive utilized by the Company. This plan will provide the Company with greater flexibility to respond to changes in equity compensation practices, in view of the anticipated impact of changes in accounting for stock options and other equity compensation.
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| AdministrationAdministration. |
The plan will be administered by a committee consisting initially of the members of the Compensation Committee of the Company’s Board of Directors.Directors or such other committee as may be appointed by the Board of Directors to administer the plan. The administrative committee will consistshall in any event be comprised of not less than two (2) or more members of the Board of Directors. The administrative committee has broad discretionary powers. The Board of Directors may exercise any power or discretion conferred on the administrative committee.
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| Stock Subject to the Stock Incentive Plan |
We will at all times reserve and keep available such number of shareswho shall each qualify as may be required to meet the needsoutside directors under Section 162(m) of the plan. A maximum of 3,000,000 shares of Class A Stock may be issued for restricted stock awards and upon the exercise of options granted under the plan. Any sharesCode.
Term. The plan became effective on March 28, 2006, subject to stock awardsshareholder approval, and if approved by shareholders, will continue for ten years, unless amended or option grants underterminated.
Eligibility. Participation in the plan which expire oris limited to executives who are terminated, forfeited or cancelled without having been exercised or vested in full, shall be available for further grant under the plan. As of April 1, 2005, the aggregate fair market value of the shares to be reserved under this plan was $28.4 million, based on the closing sales price per share of Class A Stock of $9.45 on Nasdaq on March 31, 2005.
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The administrative committee will select the people who will receive stock option grants and restricted stock awards under the plan. Any employee or director of the Company or of any of the Company’s subsidiaries or parent, and any independent contractor or agent of Company, may be selected to receive restricted stock awards and stock option grants. As of April 1, 2005, six directors and approximately 17 employees were eligible to be selected to receive stock options and restricted stock awards.
The administrative committee may, in its discretion, grant awards of restricted stock to eligible individuals and eligible directors, up to a maximum of 300,000 shares of the Class A Stock. The administrative committee will determine at the time of the grant whether the award is a performance-based restricted stock award, the number of shares of Class A Stock subject to an award, the vesting schedule applicable to the award and may, in its discretion, establish other terms and conditions applicable to the award. In setting terms and conditions, it may not grant restricted stock awards for more than 1,500,000 shares in any one calendar year to any person who is a “covered employee”employees” under Section 162(m) of the Code or to all such persons in the aggregate.
As a general rule, shares of the Company’s Class A Stock that are subject to a restricted stock award will be heldand who have been selected by the administrative committee foras participants in the benefit of the award recipient until vested and, when vested, are transferred to the award recipient. Unless the administrative committee determines otherwise with respect to any restricted stock award, before the shares subject to a restricted stock award are vested and transferred to the award recipient, theplan.
Performance Criteria. The administrative committee will exercise any voting or tender rights in its discretion and hold and accumulate any dividends or distributionsestablish for distribution at the same time and terms as the underlying shares. In the alternative, the administrative committee may authorize the immediate distribution of the restricted shareseach participant selected to the award recipientparticipate in the form of a stock certificate bearing a legend containing the applicable vesting restrictionsplan an objective performance goal or the immediate distribution of dividends paid on the underlying shares.
All restricted stock awards will be subject to a vesting schedule specified by the administrative committee when the award is made. If the administrative committee does not specify a vesting schedule, the award will vest on the first anniversary of the grant date. In the event of death or termination due to disability before the vesting date, unvested awards that would have vested within six months after death or termination for disability will be deemed vested. All other awards that are unvested at termination of employment will be forfeited, with the award recipient receiving a refund equal to the lesser of the fair market value of the unvested shares at termination of employment or the amount (if any) paid when the award was made.
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| Performance-Based Restricted Stock Awards |
At the time of grant of a restricted stock award, the administrative committee may designate a restricted stock award as a performance-based restricted stock award. If it does so, it shall establish, in addition to or in lieu of service-based vesting requirements, one or more performance goals which must be attained as a condition of retention of the shares. The performance goal(s) shall be based on one or more of the following:following performance criteria:
| | |
| • | earnings per share, |
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| • | net income, |
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| • | EBITDA,pretax income, |
|
| • | return on average equity, |
|
| • | return on average assets, |
|
| • | return on capital, |
|
| • | core earnings, |
|
| • | stock price, |
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| | |
| • | strategic business objectives, consisting of one or more objectives based on meeting specified cost targets, business expansion goals, goals relating to acquisitions or divestitures, revenue targets or business development goals, andor |
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| • | except in the case of a “covered employee” under Section 162(m)any combination of the Code, any other performance criteria established by the administrative committee.foregoing. |
Performance goals may be established on the basis of reported earnings or cash earnings, and consolidated results or individual business units and may, in the discretion of the administrative committee, include or exclude extraordinary itemsand/or the results of discontinued operations. Each performance goal may be expressed on an absoluteand/or relative basis, may be based on or otherwise employ comparisons based on internal targets, the past performance of the Company (or individual business units)and/or the past or current performance of other companies.
Attainment of the performance goals will be measured over a performance measurement period specifiedof one fiscal year, or a longer period, as determined by the administrative committee. The administrative committee will establish the performance goal no later than 90 days after the commencement of a performance measurement period.
The maximum amount of a participant award under the plan shall be set by the administrative committee whenon or before the grant of the award is made. At least 75%but shall in no event exceed Two Million Dollars ($2,000,000). The actual amount of anya participant’s performance measurement period will occur after the performance goal(s) are established.
The administrative committee will determine in its discretion whether the award recipient has attained the goals. If they have been attained, the administrative committee will certify that fact in writing. If the performance goals are not satisfied during the performance measurement period, the relevant awards willmay be forfeited. If the performance goals and any service-based vesting schedule are satisfied, the award will be distributed (or any vesting-related legend removed from any stock certificates previously delivered to the award recipient). No performance-based restricted stock awards will be granted after the fifth anniversary of the plan’s effective date unless the list of permissible performance goals is re-approved by the shareholders.
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| Terms and Conditions of Stock Option Grants |
The administrative committee will set the terms and conditions of the stock options that it grants. In setting terms and conditions, it must observe the following restrictions:
| | |
| • | It may not grant options to purchase more than 1,500,000 shares in the aggregate to individuals who are “covered employees” under Section 162(m) of the Code. In addition, it may not grant options to purchase more than 300,000 shares to any individual during any calendar year. |
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| • | It may not grant a stock option with a purchase price that is less than the fair market value of a share of Class A Stock on the date it grants the stock option. |
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| • | It may not grant a stock option with a term that is longer than 10 years. |
The administrative committee may grant incentive stock options that qualify for special federal income tax treatmentreduced or non-qualified stock options that do not qualify for special federal income tax treatment. Incentive stock options are subject to certain additional restrictions under the Code and the plan. Unless otherwise designatedeliminated by the administrative committee options granted will be exercisable forin its sole discretion. The administrative committee in its sole discretion shall determine whether or not to pay all or part of a periodperformance award in the case of 10 years after the date of grant (or for a shorter period ending three months after the option holder’s termination of employment due to disability, one year after termination of employment due to death or immediately upon terminationdisability of a participant during a performance period.
Determination of Award. Payment of any performance award to a participant for any other reason). The exerciseperformance period may be further extended for limited periods in the administrative committee’s discretion.
Upon the exercise of an option, the exercise price of the option must be paid in full. Payment mayshall be made in cash Class A Stock already ownedafter written certification by the option holder, or in such other consideration as the administrative committee authorizes. Options may be transferred prior to exercise only to certain family members, trusts orthat the performance goal for the performance period was achieved, and any other entities owned by the option holder and/or such family members, charitable organizations and on deathmaterial terms of the option holder.performance award were satisfied.
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| Mergers and Reorganizations |
The number of shares available under the plan, the maximum limits on option grantsAmendment and restricted stock awardsTermination. Subject to persons or groups of persons individuallyapplicable laws and in the aggregate, any outstanding awards and the number of shares subject to outstanding options may be adjusted, to reflect any merger, consolidation or
24
business reorganization in which the Company is the surviving entity, and to reflect any stock split, stock dividend, spin-off or other event where the administrative committee determines an adjustment is appropriate in order to prevent the enlargement or dilution of an award recipient’s rights. If a merger, consolidation or other business reorganization occurs and the Company is not the surviving entity, any outstanding options, at the discretion ofregulations, the administrative committee or the Board of Directors may be canceled and payment madeamend or terminate the plan from time to time in such respects as the option holder in an amount equal toadministrative committee or the valueBoard of Directors may deem advisable, without the approval of the canceled optionsCompany’s shareholders. However, no amendment or modified to provide for alternative, nearly equivalent securities. Any outstanding restricted stock award shall be adjusted by allocating to the award recipient any money, stock, securitiestermination or other property received by the other shareholders of record, and such money, stock, securities or other property shall be subject to the same terms and conditionsmodification of the restricted stockplan may impair the rights of a participant to any performance award that appliedalready granted with respect to the shares for which it has been exchanged.any performance period.
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| Termination or AmendmentWhy we are asking for shareholders’ approval |
The Company’s Board of Directors has the authority to suspend or terminate the plan in whole or in part at any time by giving written notice to the administrative committee; however, no amendment or termination may affect any option or restricted stock award granted prior to the amendment or termination without the recipient’s consent, unless the administrative committee finds that such amendment or termination is in the best interests
Section 162(m) of the award recipients or the Company’s shareholders.
The Board of Directors has the authority to amend or revise the plan in whole or part at any time. AsCode places a Nasdaq listed company, the Company is required to seek shareholder approval for amendments to the plan that are deemed material under the Nasdaq listing rules. No material amendments affecting the terms of stock options or performance-based restricted stock awards may be made without shareholder approval.
This plan will continue in effect for 10 years from the date of adoption by our Board of Directors unless terminated sooner. No performance-based restricted stock awards will be granted after the fifth anniversary of the plan’s effective date unless the list of permissible performance goals is re-approved by the shareholders.
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| Federal Income Tax Consequences |
The following discussion is intended to be$1 million annual limit on a summary and is not a comprehensive description of the federal tax laws, regulations and policies affecting the Company and recipients of restricted stock awards or stock option grants that may be granted under the plan. Any descriptions of the provisions of any law, regulation or policy are qualified in their entirety by reference to the particular law, regulation or policy. Any change in applicable law or regulation or in the policies of various taxing authorities may have a significant effect on this summary. The plan is not a qualified plan under Section 401(a) of the Code.
Restricted Stock Awards. The stock awards under the plan do not result in federal income tax consequences to either the Company or the award recipient. Once the award is vested and the shares subject to the award are distributed, the award recipient will generally be required to include in ordinary income, for the taxable year in which the vesting date occurs, an amount equal to the fair market value of the shares on the vesting date. The Company will generally be allowed to claim a deduction, for compensation expense, in a like amount. If dividends are paid on unvested shares held under the plan, such dividend amounts will also be included in the ordinary income of the recipient. The Company will generally be allowed to claim a deduction for compensation expense for this amount as well.
In certain cases, a recipient of a restricted stock award that is not a performance-based restricted stock award may elect to include the value of the shares subject to a restricted stock award in income for federal income tax purposes when the award is made instead of when it vests.
Stock Options. Incentive stock options will not create federal income tax consequences when they are granted. If incentive stock options are exercised during employment or within three months after termination of employment (one year for termination due to death or disability), the exercise will not create federal income tax consequences either. When the shares acquired on exercise of an incentive stock option are sold,
25
the seller must pay federal income taxes on the amount by which the sales price exceeds the purchase price. This amount will be taxed at capital gains rates if the sale occurs at least two years after the option was granted and at least one year after the option was exercised. Otherwise, it is taxed as ordinary income.
Incentive stock options that are exercised more than one year after termination of employment due to death or disability or three months after termination of employment for other reasons are treated as non-qualified stock options. Non-qualified stock options will not create federal income tax consequences when they are granted. When non-qualified stock options are exercised, federal income taxes at ordinary income tax rates must be paid on the amount by which the fair market value of the shares acquired by exercising the option exceeds the exercise price. When an option holder sells shares acquired by exercising a non-qualified stock option, he or she must pay federal income taxes on the amount by which the sales price exceeds the purchase price plus the amount included in ordinary income at option exercise. This amount will be taxed at capital gains rates, which will vary depending upon the time that has elapsed since the exercise of the option.
When a non-qualified stock option is exercised, the Company may be allowed apublic company’s federal income tax deduction for the same amount that the option holder includes in his or her ordinary income. When an incentive stock option is exercised, the Company will not be allowedcompensation paid to claim a deduction unless the shares acquired are resold sooner than two years after the option was granted or one year after the option was exercised.
Deduction Limits. The Code places an annual limit of $1 million each on the tax deduction that the Company may claim in any fiscal year for the compensation of ourits chief executive officer and any other executive officers named in the summary compensation table included in the Company’sits annual proxy statement. There is an exceptionThe limit does not apply to this limit forshareholder-approved “qualified performance-based compensation.” The Company has designed thisWe are asking our shareholders to approve the plan with the intention that the stock options and performance-based restricted stock awardsso that we grant after obtaining shareholder approval will constitute qualified performance-based compensation. As a result, the Company does not believe that the $1 million limit will impair itsmay preserve our ability to claim federal income tax deductions for compensation attributablerelating to future performance-based restricted stockcash bonuses paid to these executive officers. Approval of the plan requires the affirmative vote of the majority of the votes cast on this proposal.
NEW PLAN BENEFITS
New Plan Benefits. The Committee has established performance goals and target awards and stock options granted under the plan.plan for fiscal year 2006 for Alan B. Levan. The $1 million limit would apply to future restricted stock awards,actual award, if any, made to covered employees that are not designated as performance-based restricted stock awards.
The preceding statements are intendedbe paid to summarize the general principles of current federal income tax law applicable to awards that may be grantedMr. Levan under the plan. State and local tax consequences may alsoplan cannot be significant.
Restricted stock awards and optiondetermined at this time since the award is dependent on the Company’s financial performance for fiscal year 2006, but the maximum amount of the award is 60% of Mr. Levan’s base salary payable upon the Company’s achievement of certain pretax income targets. Other than the grant to Mr. Levan, no other grants under the plan are discretionary and the administrative committee has not yet determined to whom awards will be made and the terms and conditions of such awards. As a result, no information is provided concerning the benefits to be delivered under the plan to any individual or group of individuals.have been made.
IF WE DO NOT RECEIVE SHAREHOLDER APPROVAL, WE WILL NOT GRANT ANY AWARDS UNDER THE PLAN AND ANY OUTSTANDING AWARDS WILL BE FORFEITED.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Principal Shareholders of the Company and Security Ownership of Management
The following table sets forth, as of March 28, 2005,20, 2006, certain information as to Class A Stock and Class B Stock beneficially owned by persons owning in excess of 5% of the outstanding shares of such stock. In addition, this table includes the outstanding securities beneficially owned by the Company’s Beneficial Owners, directors and executive officers named in the Summary Compensation Table and the number of shares owned by directors and executive officers as a group. Management knows of no person, except as listed below, who beneficially owned more than 5% of the Company’s outstanding Class A Stock or Class B Stock as of March 28, 2005.20, 2006. Except as otherwise indicated, the information provided in the following table was obtained from filings with the SECSecurities and Exchange Commission (the “SEC”) and with the Company pursuant to the Securities Exchange Act.Act of 1934, as amended (the “Exchange Act”). For purposes of the table below in accordance withRule 13d-3 under the Exchange Act, a person is deemed to be the beneficial owner of any shares of the Company’s common stockCommon Stock (1) over which he or she has or shares, directly or indirectly, voting or investment power, or (2) of which he or she has the right to acquire beneficial ownership at any time within 60 days after March 28, 2005.20, 2006. As used herein, “voting power” is the power to vote, or direct the voting of, shares and “investment power” includes the power to dispose, or direct the disposition of, such shares. Unless otherwise noted, each beneficial owner has sole voting and sole investment power over the shares beneficially owned.
| | | | | | | | | | | | | | | | | | |
| | | | Class A | | | Class B | | | Percent of | | | Percent of | |
| | | | Stock | | | Stock | | | Class A | | | Class B | |
Name of Beneficial Owner | | | | Ownership | | | Ownership | | | Stock | | | Stock | |
| | | | | | | | | | | | | | |
I.R.E. Realty Advisory Group, Inc. | | (2)(3)(5) | | | 4,764,284 | | | | 500,000 | | | | 20.0 | % | | | 11.7 | % |
Florida Partners Corporation | | (3)(5) | | | 1,270,294 | | | | 133,314 | | | | 5.3 | % | | | 3.1 | % |
I.R.E. Properties, Inc. | | (3)(5) | | | 1,302,233 | | | | 136,666 | | | | 5.5 | % | | | 3.2 | % |
I.R.E. Realty Advisors, Inc. | | (3)(5) | | | 2,308,019 | | | | 242,221 | | | | 9.7 | % | | | 5.7 | % |
Levan Enterprises, Ltd. | | (3)(5) | | | 532,314 | | | | 55,865 | | | | 2.2 | % | | | 1.3 | % |
Alan B. Levan | | (1)(3)(5)(6) | | | 507,073 | | | | 2,786,464 | | | | 2.1 | % | | | 45.1 | % |
Glen R. Gilbert | | (1)(5) | | | 13,578 | | | | 368,743 | | | | 0.1 | % | | | 8.0 | % |
John E. Abdo | | (1)(3)(5)(6) | | | 4,424,198 | | | | 3,347,210 | | | | 17.8 | % | | | 54.2 | % |
Earl Pertnoy | | (1)(5) | | | 95,025 | | | | 188,635 | | | | 0.4 | % | | | 4.2 | % |
Oscar Holzmann | | (1)(5) | | | — | | | | 20,290 | | | | 0.0 | % | | | 0.5 | % |
Neil Sterling | | (1)(5) | | | — | | | | 20,290 | | | | 0.0 | % | | | 0.5 | % |
D. Keith Cobb | | (1)(5) | | | 3,017 | | | | 6,250 | | | | 0.0 | % | | | 0.1 | % |
Dr. Herbert A. Wertheim | | (4) | | | 3,968,157 | | | | 416,448 | | | | 16.6 | % | | | 9.7 | % |
Phil J. Bakes | | | | | | | | | | | | | | | | | | |
All directors and executive officers of the Company as a group (6 persons, including the individuals identified above) | | (1)(3) | | | 15,038,035 | | | | 7,805,948 | | | | 63.0 | % | | | 90.2 | % |
| | | | | | | | | | | | | | | | | | | | |
| | | | | Class A
| | | Class B
| | | Percent of
| | | Percent of
| |
| | | | | Stock
| | | Stock
| | | Class A
| | | Class B
| |
Name of Beneficial Owner | | Notes | | | Ownership | | | Ownership | | | Stock | | | Stock | |
|
I.R.E. Realty Advisory Group, Inc. | | | (2,3,5 | ) | | | 4,764,285 | | | | 500,000 | | | | 16.6 | % | | | 7.0 | % |
Florida Partners Corporation | | | (3,5 | ) | | | 1,270,302 | | | | 133,314 | | | | 4.4 | % | | | 1.9 | % |
I.R.E. Properties, Inc. | | | (3,5 | ) | | | 2,928,727 | | | | 379,017 | | | | 10.2 | % | | | 5.3 | % |
Levan Enterprises, Ltd. | | | (3,5 | ) | | | 431,649 | | | | 55,865 | | | | 1.5 | % | | | 0.8 | % |
Alan B. Levan | | | (3,5,6 | ) | | | 11,437 | | | | 2,120,656 | | | | 0.0 | % | | | 29.7 | % |
Glen R. Gilbert | | | (1,5 | ) | | | — | | | | 253,584 | | | | 0.0 | % | | | 3.5 | % |
John E. Abdo | | | (3,5,6 | ) | | | 3,371,771 | | | | 2,969,468 | | | | 11.8 | % | | | 41.6 | % |
Earl Pertnoy | | | (1,5 | ) | | | 99,305 | | | | 188,635 | | | | 0.3 | % | | | 2.6 | % |
Oscar Holzmann | | | (1,5 | ) | | | 5,631 | | | | 20,290 | | | | 0.0 | % | | | 0.3 | % |
D. Keith Cobb | | | (1,5 | ) | | | 14,279 | | | | 6,250 | | | | 0.0 | % | | | 0.1 | % |
Phil J. Bakes | | | (5 | ) | | | — | | | | — | | | | 0.0 | % | | | 0.0 | % |
Neil Sterling | | | (1,5 | ) | | | 5,631 | | | | 20,290 | | | | 0.0 | % | | | 0.3 | % |
Dr. Herbert A. Wertheim | | | (4 | ) | | | 3,968,157 | | | | 416,448 | | | | 13.8 | % | | | 5.8 | % |
All directors and executive officers of the Company as a group (8 persons, | | | | | | | | | | | | | | | | | | | | |
including the individuals identified above) | | | (1,3 | ) | | | 12,903,017 | | | | 6,647,369 | | | | 45.0 | % | | | 88.9 | % |
| | |
(1) | | Amount and nature of beneficial ownership and percent of class include shares that may be acquired within 60 days pursuant to exercise of stock options to purchase Class B Stock as follows: Alan B. Levan 1,895,150 shares, John E. Abdo 1,895,150 shares, Glen R. Gilbert 350,743114,902 shares, Earl Pertnoy 181,735 shares, Oscar Holzmann 20,290 shares, D. Keith Cobb 6,250 shares and Neil Sterling 20,290 shares. |
|
(2) | | The Company owns 45.5% of I.R.E. Realty Advisory Group, Inc. |
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| |
(3) | | The Company may be deemed to be controlled by Alan B. Levan and John E. Abdo who collectively may be deemed to have an aggregate beneficial ownership of 69.3%52.9% of the outstanding Common Stock of the Company. I.R.E. Properties, Inc. is 100% owned by Levan Enterprises, Ltd. is a controlling and majority shareholder of I.R.E. Realty Advisors, Inc. and I.R.E. Properties, Inc. andLevan Enterprises, Ltd. may be deemed to be the controlling shareholder of I.R.E. Realty Advisory Group, Inc. and Florida Partners Corporation. Levan Enterprises, Ltd. is a limited partnership whose sole general partner is Levan General Corp., a corporation 100% owned by Alan B. Levan. Therefore, Mr. Levan may be deemed to be the beneficial |
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| | |
| | owner of the shares of Common Stock owned by each of such entities. In addition to his personal holdings of Common Stock, Mr. Levan may be deemed to be the beneficial owner of 11,43511,437 shares of Class A Stock and 1,200 shares of Class B Stock held of record by Mr. Levan’s wife, and 1,895,150 shares of Class B Stock which can be acquired within 60 days pursuant to stock options, for an aggregate beneficial ownership of 10,684,2179,406,400 shares (44.8%(32.8%) of Class A Stock and 3,854,5313,188,852 shares (62.4%(44.7%) of Class B Stock. |
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(4) | | Dr. Wertheim’s ownership was reported in a Rebuttal of Control Agreement filed on December 20, 1996 with the Office of Thrift Supervision (as adjusted for stock splits since the date of filing). The Rebuttal of Control Agreement indicates that Dr. Wertheim has no intention to manage or control, directly or indirectly, the Company. Dr. Wertheim’s mailing address is 191 Leucadendra Drive, Coral Gables, Florida 33156. |
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(5) | | Mailing address is 1750 East Sunrise Boulevard,2100 West Cypress Creek Road, Fort Lauderdale, Florida 33304.33309. |
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(6) | | Messrs. Levan and Abdo have entered into a Shareholders Agreement and Irrevocable Proxy with respect to the shares of Class B Stock controlled by them. Under the agreement, they have agreed to vote their shares of Class B Stock in favor of the election of each other to the Company’s Board of Directors for so long as Mr. Levan and Mr. Abdo are willing and able to serve as directors of the Company. Additionally, Mr. Abdo will grant an irrevocable proxy to an entity controlled by Mr. Levan and obtain the consent of Mr. Levan prior to the sale or conversion of certain of his shares of Class B Stock. |
EQUITY COMPENSATION PLAN INFORMATION
Set forth below is certain information, as of March 28, 2005,20, 2006, concerning our equity compensation plans for which we have previously obtained shareholder approval and those equity compensation plans for which we have not previously obtained shareholder approval:
| | | | | | | | | | | | | |
| | Number of Securities | | | | | |
| | to be Issued Upon | | | Weighted Average | | | |
| | Exercise of | | | Exercise Price of | | | Number of Securities | |
| | Outstanding Options, | | | Outstanding Options, | | | Remaining Available | |
Plan Category | | Warrants or Rights | | | Warrants and Rights | | | for Future Issuance | |
| | | | | | | | | |
Equity compensation plans approved by security holders | | | 5,107,477 | | | $ | 2.60 | | | | — | |
Equity compensation plans not approved by security holders | | | — | | | | — | | | | — | |
| Total | | | 5,107,477 | | | $ | 2.60 | | | | — | |
| | | | | | | | | | | | |
| | Number of Securities
| | | Weighted Average
| | | | |
| | to be Issued Upon
| | | Exercise Price of
| | | | |
| | Exercise of
| | | Outstanding
| | | Number of Securities
| |
| | Outstanding Options,
| | | Options, Warrants
| | | Remaining Available
| |
Plan Category | | Warrants or Rights | | | and Rights | | | for Future Issuance | |
|
Equity compensation plans approved by security holders | | | 1,393,111 | | | $ | 4.55 | | | | 2,745,976 | |
Equity compensation plans not approved by security holders | | | — | | | | — | | | | — | |
Total | | | 1,393,111 | | | $ | 4.55 | | | | 2,745,976 | |
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors is not aware of any matters, other than those referred to in the accompanying Notice of Meeting, that may be brought before the Annual Meeting.
INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM
PricewaterhouseCoopers LLP served as the Company’s independent registered certified public accounting firm for each of the years ended December 31, 20042005 and 2003.2004. A representative of PricewaterhouseCoopers LLP is expected to be present at the Annual Meeting, will have the opportunity to make a statement if he desires to do so, and will be available to respond to appropriate questions from shareholders.
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ADDITIONAL INFORMATION
“Householding” of Proxy Material. The SEC has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or more shareholders sharing the same address by delivering a single proxy statement addressed to those shareholders. This process, which is commonly referred to as “householding,” potentially provides extra convenience for shareholders and cost savings for companies. The Company and some brokers household proxy materials, delivering a single proxy statement to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once you have received notice from your broker or our transfer agent, American Stock
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Transfer & Trust Company (“AST”), that they or we will be householding materials to your address, householding will continue until you are notified otherwise or until you revoke your consent. However, the Company will deliver promptly upon written or oral request a separate copy of this Proxy Statementproxy statement to a shareholder at a shared address to which a single Proxy Statementproxy statement was delivered. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate Proxy Statement,proxy statement, or if you are receiving multiple proxy statements and would like to request delivery of a single proxy statement, please notify your broker if your shares are held in a brokerage account or AST if you hold registered shares. You can notify AST by calling800-937-5449 or by sending a written request to American Stock Transfer & Trust Company, 59 Maiden Lane — Plaza Level, New York, NY 10038, attention Karen A. Trachtenberg, Vice President.
Advance Notice Procedures. Under our bylaws, no business may be brought before an Annual Meeting unless it is specified in the notice of the meeting or is otherwise brought before the Annual Meeting by or at the direction of the Board or by a shareholder entitled to vote who has delivered written notice to the Company’s Secretary (containing certain information specified in the bylaws about the shareholder and the proposed action) not less than 90 or more than 120 days prior to the first anniversary of the preceding year’s annual meeting — that is, with respect to the 20062007 Annual Meeting, between January 1716 and February 16, 2006.17, 2007. In addition, any shareholder who wishes to submit a nomination to the Board must deliver written notice of the nomination within this time period and comply with the information requirements in the bylaws relating to shareholder nominations. These requirements are separate from and in addition to the SEC’s requirements that a shareholder must meet in order to have a shareholder proposal included in the Company’s Proxy Statement.
Shareholder Proposals for the 20062007 Annual Meeting. Shareholders interested in submitting a proposal for inclusion in the proxy materials for the 2006 Annual Meetingannual meeting of shareholders in 2007 may do so by following the procedures prescribed in SEC Rulel4a-8. To be eligible for inclusion, shareholder proposals must be received by the Company’s Secretary no later than December 20, 200518, 2006 at the Company’s main offices, 1750 East Sunrise Boulevard,2100 West Cypress Creek Road, Fort Lauderdale, Florida 33304.33309. If such proposal or proposals are in compliance with applicable rules and regulations, they will be included in the Company’s proxy statement and form of proxy for that meeting.
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Proxy Solicitation Costs. The Company will bear the expense of soliciting proxies and of reimbursing brokers, banks and nominees for theout-of-pocket and clerical expenses of transmitting copies of the proxy materials to the beneficial owners of shares held of record by such persons. The Company does not currently intend to solicit proxies other than by use of the mail, but certain directors, officers and regular employees of the Company or its subsidiaries, BankAtlantic Bancorpand/or Levitt, without additional compensation, may solicit proxies personally or by telephone, fax, special letter or otherwise.
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| BY ORDER OF THE BOARD OF DIRECTORS |
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| Alan B. Levan |
| Chairman |
BY ORDER OF THE BOARD OF DIRECTORS
Alan B. Levan
Chairman
April 19, 200517, 2006
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Appendix A
BFC FINANCIAL CORPORATION
2005 STOCK
2006 PERFORMANCE-BASED ANNUAL INCENTIVE PLAN
1. PURPOSES.PURPOSE. The purposespurpose of this 2006 Performance-Based Annual Incentive Plan is to advance the interests of BFC Financial Corporation 2005 Stock Incentiveand its shareholders by providing certain of its key executives with annual incentive compensation which is tied to the achievement of pre-established and objective performance goals. The Plan (the “Plan”) are to attract and retain the best available personnel for positions of substantial responsibility,is intended to provide additionalparticipants with annual incentive compensation which is not subject to the Employees of the Company or its Subsidiaries (as defined indeduction limitation rules prescribed under Section 2 below) as well as other individuals who perform services for the Company and its Subsidiaries, and to promote the success and profitability of the Company’s business. Options granted hereunder may be either “incentive stock options,” as defined in Section 422162(m) of the Internal Revenue Code of 1986, as amended or “non-qualified stock options,” at(the “Code”), and should be construed to the discretionextent possible as providing for remuneration which is “performance-based compensation” within the meaning of Section 162(m) of the Code and the regulations promulgated thereunder.
2. DEFINITIONS. Unless the context clearly indicates otherwise, the following terms shall have the following meanings:
(a) “Board” means the Board of Directors of BFC Financial Corporation.
(b) “Committee” means the Compensation Committee (asof the Board of Directors or such other committee as may be appointed by the Board of Directors to administer the Plan; provided, however, that in any event the Committee shall be comprised of two (2) or more members of the Board of Directors who shall each qualify as “outside directors” under Section 162(m) of the Code.
(c) “Corporation” means BFC Financial Corporation or any entity that is directly or indirectly controlled by BFC Financial Corporation.
(d) “Participant” means a “covered employee” as defined in Section 2 below)162(m) of the Code and the regulations promulgated thereunder, who has been selected by the Committee as reflecteda participant in the Plan during a Performance Period.
(e) “Performance Award” means an award granted pursuant to the terms of the Stock Option Agreement (as defined in Section 2 below).
2. DEFINITIONS. As used herein, the following definitions shall apply:
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| (a) “Award Notice” shall mean, with respect to a particular Restricted Stock Award, a written instrument signed by the Company and the recipient6 of the Restricted Stock Award evidencing the Restricted Stock Award and establishing the terms and conditions thereof. |
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| (b) “Award Recipient” shall mean the recipient of a Restricted Stock Award. |
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| (c) “Beneficiary” shall mean the Person designated by an Award Recipient to receive any Shares subject to a Restricted Stock Award made to such Award Recipient that become distributable following the Award Recipient’s death. |
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| (d) “Board of Directors” shall mean the Board of Directors of the Company. |
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| (e) “Class A Common Stock” shall mean the Class A common stock, par value $0.01 per share, of the Company. |
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| (f) “Code” shall mean the Internal Revenue Code of 1986, as amended. |
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| (g) “Committee” shall mean the Committee appointed by the Board of Directors in accordance with paragraph (a) of Section 4 of the Plan. |
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| (h) “Company” shall mean BFC Financial Corporation, a Florida corporation, and its successors and assigns. |
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| (i) “Continuous Status as an Employee” shall mean the absence of any interruption or termination of service as an Employee. Continuous Status as an Employee shall not be considered interrupted in the case of sick leave, military leave, or any other leave of absence approved by the Board of Directors of the Company or the Committee. Continuous Status as an Employee shall not be deemed terminated or interrupted by a termination of employment followed immediately by service as a non-Employee director of the Company or one or more of its Subsidiaries until a subsequent termination of all service as either a non-Employee director or an Employee. |
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| (j) “Covered Employee” shall mean, for any taxable year of the Company, a person who is, or who the Committee determines is reasonably likely to be, a “covered employee” (within the meaning of section 162(m) of the Code). |
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| (k) “Disability” shall mean permanent and total disability as defined in Section 22(e)(3) of the Code. |
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| (l) “Employee” shall mean any person, including officers and directors, employed by the Company or any Parent or Subsidiary of the Company. The payment of a director’s fee by the Company shall not be sufficient to constitute “employment” by the Company. |
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| (m) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. |
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| (n) “Fair Market Value” shall be determined by the Committee in its discretion; provided, however, that where there is a public market for the Class A Common Stock, the fair market value per Share shall be (i) if the Class A Common Stock is listed or admitted for trading on any United States national securities exchange, or if actual transactions are otherwise reported on a consolidated transaction reporting system, the closing price of such stock on such exchange or reporting system, as the case may be, on the relevant date, as reported in any newspaper of general circulation, or (ii) if the Class A Common Stock is quoted on the National Association of Securities Dealers Automated Quotations (“NASDAQ”) System, or any similar system of automated dissemination of quotations of securities prices in common use, the mean between the closing bid and asked quotations for such stock on the relevant date, as reported by a generally recognized reporting service. |
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| (o) “Incentive Stock Option” shall mean a stock option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code. |
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| (p) “Nonqualified Stock Option” shall mean a stock option not intended to qualify as an Incentive Stock Option or a stock option that at the time of grant, or subsequent thereto, fails to satisfy the requirements of Section 422 of the Code. |
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| (q) “Option” shall mean a stock option granted pursuant to the Plan. |
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| (r) “Optioned Stock” shall mean the Class A Common Stock subject to an Option. |
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| (s) “Optionee” shall mean the recipient of an Option. |
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| (t) “Parent” shall mean a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code. |
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| (u) “Performance-Based Restricted Stock Award” shall mean a Restricted Stock Award to which Section 8.3 is applicable. |
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| (v) “Performance Goal” shall mean, with respect to any Performance-Based Restricted Stock Award, the performance goal(s) established pursuant to Section 8.3(a), the attainment of which is a condition of vesting of the Performance-Based Restricted Stock Award. |
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| (w) “Performance Measurement Period” shall mean, with respect to any Performance Goal, the period of time over which attainment of the Performance Goal is measured. |
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| (x) “Person” shall mean an individual, a corporation, a partnership, a limited liability company, an association, a joint-stock company, a trust, an estate, an unincorporated organization and any other business organization or institution. |
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| (y) “Restricted Stock Award” shall mean an award of Shares pursuant to Section 8. |
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| (z) “Rule 16b-3” shall mean Rule 16b-3 promulgated by the Securities and Exchange Commission under the Exchange Act or any successor rule. |
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| (aa) “Service” shall mean, unless the Committee provides otherwise in an Award Notice: (a) service in any capacity as a common-law employee, director, advisor or consultant to the Company or a Parent or Subsidiary; (b) service in any capacity as a common-law employee, director, advisor or consultant (including periods of contractual availability to perform services under a retainer arrangement) to an entity that was formerly a Parent or Subsidiary, to the extent that such service is an uninterrupted continuation of services being provided immediately prior to the date on which such entity ceased to be a Parent or Subsidiary; and (c) performance of the terms of any contractual non-compete agreement for the benefit of the Company or a Parent or Subsidiary. |
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| (bb) “Share” shall mean a share of the Class A Common Stock, as adjusted in accordance with Section 9 of the Plan. |
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| (cc) “Stock Option Agreement” shall mean the written option agreements described in Section 14 of the Plan. |
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| (dd) “Subsidiary” shall mean a “subsidiary corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Code. |
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| (ee) “Transferee” shall mean a “transferee” of the Optionee as defined in Section 7.4 of the Plan. |
3. STOCK. Subject to the provisions of Section 9 of the Plan, the maximum aggregate number of Shares which may be issued for Restricted Stock Awards and upon the exercise of Options under the Plan is 3,000,000 Shares. The maximum aggregate number of Shares which may be covered by Options granted to individuals who are Covered Employees shall be 1,500,000 Shares during any calendar year. The maximum aggregate number of Shares which may be issued as Restricted Stock Awards to individuals who are Covered Employees shall be 300,000 Shares during any calendar year. If an Option or Restricted Stock Award should expire or become un-exercisable for any reason without having been exercised or vested in full, the unpurchased Shares which were subject thereto shall, unless the Plan shall have been terminated, become available for further grant under the Plan.
Subject
(f) “Performance Goal” means the performance goal and payout schedules established by the Committee for a Participant (or group of Participants) no later than ninety (90) days after the commencement of each Performance Period which relates to the provisions of Section 9one or more of the Plan, no person shall be granted Options under the Planperformance measures set forth in any calendar year covering an aggregate of more than 100,000 Shares. If an Option should expire, become unexercisable for any reason without having been exercised in full, or be cancelled for any reason during the calendar year in which it was granted, the number of Shares covered by such Option shall nevertheless be treated as Options granted for purposesSection 6(b) of the limitation inPlan.
(g) “Performance Period” means the preceding sentence.Corporation’s fiscal year, or such longer period as designated by the Committee.
4. ADMINISTRATION.
(h) “Plan” means this BFC Financial Corporation 2006 Performance-Based Annual Incentive Plan, as may be amended and restated from time to time.
(a) Procedure.
3. PLAN ADMINISTRATION. The Plan shall be administered by a Committee appointed by the Board of Directors, which initially shall be the Compensation Committee of the Company.Committee. The Committee shall consist of not less than two (2) membershave full discretion, power and authority to administer and interpret the Plan and to establish rules and procedures for its administration as the Committee deems necessary and appropriate. Any interpretation of the Board of Directors. Once appointed, the Committee shall continue to serve until otherwise directed by the Board of Directors. From time to time the Board of Directors, at its discretion, may increase the sizePlan or other act of the Committee and appoint additional members thereof, remove members (with or without cause), and appoint new members in substitution therefor, and fill vacancies however caused; provided, however, that at no time shall a Committee of less than two (2) members of the Board of Directors administer the Plan. If the Committee does not exist, or for any other reason determined by the Board of Directors, the Board may take any action and exercise any power, privilege or discretion underadministering the Plan that would otherwise be the responsibility of the Committee.
(b) Powers of the Committee. Subject to the provisions of the Plan, the Committee shall have the authority, in its discretion: (i) to grant Incentive Stock Options, in accordance with Section 422 of the Code, to grant Nonqualified Stock Options or to grant Restricted Stock Awards; (ii) to determine, upon review of relevant information, the Fair Market Value of the Class A Common Stock; (iii) to determine the exercise price per share of Options to be granted or consideration for Restricted Stock Awards; (iv) to determine the persons to whom, and the time or times at which, Options and Restricted Stock Awards shall be granted and the number of Shares to be represented by each Option or Restricted Stock Award; (v) to determine the vesting schedule of the Options and Restricted Stock Awards to be granted; (vi) to interpret the Plan; (vii) to prescribe, amend and rescind rules and regulations relating to the Plan; (viii) to determine the terms and provisions of each Option or Restricted Stock Award granted (which need not be identical) and, with the consent of the holder thereof if required, modify or amend each Option or Restricted Stock Award; (ix) to accelerate or defer (with the consent of the holder thereof) the exercise or vesting date of any Option or the vesting date of any Restricted Stock Award; (x) to authorize any person to execute on behalf of the Company any instrument required to effectuate the grant of an Option or Restricted Stock Award previously granted by the Committee; (xi) to grant an Option in replacement of Options previously granted under this Plan; and (xii) to make all other determinations deemed necessary or advisable for the administration of the Plan.
(c) Effect of the Committee’s Decision. All decisions, determinations and interpretations of the Committee shall be final and binding on all Optionees, Award Recipients or Transferees, if applicable.Participants.
5.
4. ELIGIBILITY. Incentive Stock Options Performance Awards under the Plan may be granted only to Employees. Nonqualified Stock Options and Restricted Stock Awards may be granted to Employeesan individual who is or may be a “covered employee” as well as directors, independent contractorsdefined in Section 162(m) of the Code and agents who are natural persons (but only if such Options or Restricted Stock Awards are
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granted as compensation for personal services rendered by the independent contractor or agent to the Company or a Subsidiary that are not services in connection with the offer or sale of securities in a capital-raising transaction or services that directly or indirectly promote or maintain a market for the Company’s securities), as determined by the Committee. Any personregulations promulgated thereunder, who has been granted an Option or Restricted Stock Award may, if he is otherwise eligible, be granted an additional Option or Options or Restricted Stock Award.
Except as otherwise provided underselected by the Code,Committee to participate in the extent that the aggregate Fair Market Value of Shares for which Incentive Stock Options (under all stock option plans of the Company and of any Parent or Subsidiary) are exercisable for the first time by an EmployeePlan during any calendar year exceeds $100,000, such excess Options shall be treated as Nonqualified Stock Options. For purposes of this limitation, (a) the Fair Market Value of Shares is determined as of the time the Option is granted and (b) the limitation is applied by taking into account Options in the order in which they were granted.Performance Period.
The Plan shall not constitute a contract of employment nor shall the Plan confer upon any Optionee or Award Recipient any right with respect to continuation of employment or continuation of providing services to the Company, nor shall it interfere in any way with his right or the Company’s or any Parent or Subsidiary’s right to terminate his employment or his provision of services at any time.
6. 5. TERM OF THE PLAN. The Plan shall become effective upon its adoption by the Board of Directors;adoption; provided, however, if the Plan is not approved by shareholders of the CompanyCorporation in accordance with Section 159 of the Plan, within twelve (12) months after the date of adoption by the Board of Directors, the Plan and any Options or Restricted StockPerformance Awards granted thereunder shall terminate and become null and void. The Plan shall continue in effect ten (10) years from the effective date of the Plan, unless sooner terminated under Section 118 of the Plan.
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7. STOCK OPTIONS.6. PERFORMANCE AWARDS. In the event that the Committee determines, in its sole and absolute discretion, to grant a Performance Award for any Performance Period, the Committee shall determine the amount of a Participant’s Performance Award as follows:
7.1 Term of Option. The term of each Option
(a) General. Each Participant shall be ten (10) years fromeligible to receive a Performance Award if the dateParticipant’s Performance Goal for the Performance Period has been achieved. The maximum amount of a Participant’s Performance Award shall be set by the Committee on or prior to the grant thereof or such shorter term asof a Performance Award; provided, however, that in no event shall a Participant’s Performance Award exceed Two Million Dollars ($2,000,000). The actual amount of a Participant’s Performance Award may be providedreduced or eliminated by the Committee as set forth in paragraph (c) below. The Committee in its sole discretion shall determine whether or not to pay all or part of the Stock Option Agreement. However,Performance Award in the case of an Incentive Stock Option granted to an Employee who, immediately before the Incentive Stock Option is granted, owns stock representing more than ten percent (10%)death or disability of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Incentive Stock Option shall be five (5) years from the date of grant thereof or such shorter time as may be provided in such Optionee’s Stock Option Agreement.a Participant during a Performance Period.
7.2 Exercise Price
(b) Performance Goals. The Committee shall establish the Performance Goals and Consideration.
(a) Price. The per Share exercise price for the Shares to be issued pursuant to exercise of an Option shall be such price as determined by the Committee, but shall be subject to the following:
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| (i) In the case of an Incentive Stock Option which is |
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| (A) granted to an Employee who, immediately before the grant of such Incentive Stock Option, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price shall be no less than one hundred and ten percent (110%) of the Fair Market Value per Share on the date of grant. |
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| (B) granted to an Employee not within (A), the per share exercise price shall be no less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant. |
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| (C) In the case of a Nonqualified Stock Option, the per Share exercise price shall be no less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant. |
(b) Certain Corporate Transactions. In the event the Company substitutes an Optionpayout schedules for a stock option issued by another corporation in connection with a corporate transaction, such as a merger, consolidation, acquisition of property or stock, separation (including a spin-off or other distribution of stock or property), reorganization (whether or not such reorganization comes within the definition of such term in Section 368 of the Code) or partial or complete liquidation involving the Company and such other corporation, the exercise price of such substituted Option shall be as determined by the Committee in its discretion (subject to the provisions of Section 424(a) of the Code in the case of a stock option that was intended to qualify as an
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“incentive stock option”) to preserve, on a per Share basis immediately after such corporate transaction, the same ratio of Fair Market Value per Option Share to exercise price per Share which existed immediately prior to such corporate transaction under the option issued by such other corporation.
(c) Payment. The consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Committee and may consist entirely of cash, check, promissory note, or other shares of the Company’s capital stock having a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Option shall be exercised, or any combination of such methods of payment, or such other consideration and method of payment for the issuance of Shares to the extent permitted under the law of the Company’s jurisdiction of incorporation. The Committee may also establish coordinated procedures with one or more brokerage firms for the “cashless exercise” of Options, whereby Shares issued upon exercise of an Option are delivered against payment by the brokerage firm on the Optionee’s behalf. When payment of the exercise price for the Shares to be issued upon exercise of an Option consists of shares of the Company’s capital stock, such shares will not be accepted as payment unless the Optionee or Transferee, if applicable, has held such shares for the requisite period necessary to avoid a charge to the Company’s earnings for financial reporting purposes.
7.3 Exercise Of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable at such times and under such conditions as determined by the Committee, including performance criteria with respect to the Company or its Subsidiaries and/or the Optionee, and as shall be permissible under the terms of the Plan. An Option may not be exercised for a fraction of a Share. An Option shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Option by the person entitled to exercise the Option and full payment for the Shares with respect to which the Option is exercised has been received by the Company. Full payment may, as authorized by the Committee, consist of any consideration and method of payment allowable under Section 7.2(c) of the Plan. Until the issuance of the stock certificate evidencing such Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), which in no event will be delayed more than thirty (30) days from the date of the exercise of the Option, no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date the stock certificate is issued, except as provided in the Plan. Exercise of an Option in any manner shall result in a decrease in the number of Shares which thereafter may be available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised.
(b) Termination of Status as an Employee. Subject to this Section 7.3(b), if any Employee ceases to be in Continuous Status as an Employee, he or any Transferee may, but only within thirty (30) days or such other period of time not exceeding three (3) months as is determined by the CommitteeParticipant (or provided that the applicable Option is not to be treated as an Incentive Stock Option, such longer period of time as may be determined by the Committee) after the date he ceases to be an Employee, exercise his Option to the extent that he or any Transferee was entitled to exercise it as of the date of such termination. To the extent that he or any Transferee was not entitled to exercise the Option at the date of such termination, or if he or any Transferee does not exercise such Option (which he or any Transferee was entitled to exercise) within the time specified herein, the Option shall terminate. If any Employee ceases to serve as an Employee as a result of a termination for cause (as determined by the Committee), any Option held by such Employee or any Transferee shall terminate immediately and automatically on the date of his termination as an Employee unless otherwise determined by the Committee. Notwithstanding the foregoing, if an Employee ceases to be in Continuous Status as an Employee solely due to a reorganization, merger, consolidation, spin-off, combination, re-assignment to another member of the affiliated group of which the Company is a member or other similar corporate transaction or event, the Committee may, in its discretion, suspend the operation of this Section 7.3(b); provided that the Employee shall execute an agreement, in form and substance satisfactory to the Committee, waiving such Employee’s right to have such Employee’s Options treated as Incentive Stock Options from and after a date determined by the Committee which shall beParticipants) no later than three months from
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ninety (90) days after the date on which such Employee ceases to be in Continuous Status as an Employee, and such Employee’s Options shall thereafter be treated as Nonqualified Options for all purposes.
(c) Disabilitycommencement of Optionee. Notwithstanding the provisions of Section 7.3(b) above, in the event an Employee is unable to continue his employment as a result of his Disability, he or any Transferee may, but only within three (3) months or such other period of time not exceeding twelve (12) months as is determined by the Committee (or, provided that the applicable Option is not to be treated as an Incentive Stock Option, such longer period of time as may be determined by the Committee) from the date of termination of employment, exercise his Option to the extent he or any Transferee was entitled to exercise it at the date of such Disability. To the extent that he or any Transferee was not entitled to exercise the Option at the date of Disability, or if he or any Transferee does not exercise such Option (which he or any Transferee was entitled to exercise) within the time specified herein, the Option shall terminate.
(d) Death of Optionee. In the event of the death of an Optionee:
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| (i) during the term of the Option and who is at the time of his death an Employee and who shall have been in Continuous Status as an Employee since the date of grant of the Option, the Option may be exercised at any time within twelve (12) months (or, provided that the applicable Option is not to be treated as an Incentive Stock Option, such longer period of time as may be determined by the Committee) following the date of death, by the Optionee’s estate, by a person who acquired the right to exercise the Option by bequest or inheritance, or by any Transferee, as the case may be, but only to the extent of the right to exercise that would have accrued had the Optionee continued living one (1) month after the date of death; or |
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| (ii) within thirty (30) days or such other period of time not exceeding three (3) months as is determined by the Committee (or, provided that the applicable Option is not to be treated as an Incentive Stock Option, such longer period of time as may be determined by the Committee) after the termination of Continuous Status as an Employee, the Option may be exercised, at any time within three (3) months following the date of death, by the Optionee’s estate, by a person who acquired the right to exercise the Option by bequest or inheritance, or by any Transferee, as the case may be, but only to the extent of the right to exercise that had accrued at the date of termination. |
7.4 Transferability Of Options. During an Optionee’s lifetime, an Option may be exercisable only by the Optionee and an Option granted under the Plan and the rights and privileges conferred thereby shall not be subject to execution, attachment or similar process and may not be sold, pledged, assigned, hypothecated, transferred or otherwise disposed of in any manner (whether by operation of law or otherwise) other than by will or by the laws of descent and distribution. Notwithstanding the foregoing, to the extent permitted by applicable law and Rule 16b-3, the Committee may determine that an Option may be transferred by an Optionee to any of the following: (1) a family member of the Optionee; (2) a trust established primarily for the benefit of the Optionee and/or a family member of said Optionee in which the Optionee and/or one or more of his family members collectively have a more than 50% beneficial interest; (3) a foundation in which such persons collectively control the management of assets; (4) any other legal entity in which such persons collectively own more than 50% of the voting interests; or (5) any charitable organization exempt from income tax under Section 501(c)(3) of the Code (collectively, a “Transferee”); provided, however, in no event shall an Incentive Stock Option be transferable if such transferability would violate the applicable requirements under Section 422 of the Code. Any other attempt to sell, pledge, assign, hypothecate, transfer or otherwise dispose of any Option under the Plan or of any right or privilege conferred thereby, contrary to the provisions of the Plan, or the sale or levy or any attachment or similar process upon the rights and privileges conferred hereby, shall be null and void.
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8. RESTRICTED STOCK AWARDS.
8.1 In General.
(a) Each Restricted Stock Award shall be evidenced by an Award Notice issued by the Committee to the Award Recipient containing such terms and conditions not inconsistent with the Plan as the Committee may, in its discretion, prescribe, including, without limitation, any of the following terms or conditions:
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| (i) the number of Shares covered by the Restricted Stock Award; |
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| (ii) the amount (if any) which the Award Recipient shall be required to pay to the Company in consideration for the issuance of such Shares (which shall in no event be less than the minimum amount required for such Shares to be validly issued, fully paid and nonassessable under applicable law); |
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| (iii) whether the Restricted Stock Award is a Performance-Based Award and, if it is, the applicable Performance Goal or Performance Goals; |
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| (iv) the date of grant of the Restricted Stock Award; and |
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| (v) the vesting date for the Restricted Stock Award; |
(b) All Restricted Stock Awards shall be in the form of issued and outstanding Shares that shall be either:
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| (i) registered in the name of the Committee for the benefit of the Award Recipient and held by the Committee pending the vesting or forfeiture of the Restricted Stock Award; |
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| (ii) registered in the name of Award Recipient and held by the Committee, together with a stock power executed by the Award Recipient in favor of the Committee, pending the vesting or forfeiture of the Restricted Stock Award; or |
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| (iii) registered in the name of and delivered to the Award Recipient. |
In any event, the certificates evidencing the Shares shall at all times prior to the applicable vesting date bear the following legend:
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| The Class A Common Stock evidenced hereby is subject to the terms of a Restricted Stock Award agreement between BFC Financial Corporation and [Name of Award Recipient] dated [Date] made pursuant to the terms of the BFC Financial Corporation 2005 Stock Incentive Plan, copies of which are on file at the executive offices of BFC Financial Corporation, and may not be sold, encumbered, hypothecated or otherwise transferred except in accordance with the terms of such Plan and Agreement. |
and/or such other restrictive legend as the Committee, in its discretion, may specify.
(c) Except as otherwise provided by the Committee, a Restricted Stock Award shall not be transferable by the Award Recipient other than by will or by the laws of descent and distribution, and the Shares granted pursuant to such Restricted Stock Award shall be distributable, during the lifetime of the Award Recipient, only to the Award Recipient.
8.2 Vesting Date.
(a) The vesting date for each Restricted Stock Award shall be determined by the Committee and specified in the Award Notice and, if no date is specified in the Award Notice, shall be the first anniversary of the date on which the Restricted Stock Award is granted. Unless otherwise determined by the Committee and specified in the Award Notice:
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| (i) if the Service of an Award Recipient is terminated prior to the vesting date of a Restricted Stock Award for any reason other than death or Disability, any unvested Shares shall be forfeited without consideration (other than a refund to the Award Recipient of an amount equal to the lesser of (A) the cash amount, if any, actually paid by the Award Recipient to the Company for the Shares being forfeited and (B) the Fair Market Value of such Shares on the date of forfeiture); |
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| (ii) if the Service of an Award Recipient is terminated prior to the vesting date of a Restricted Stock Award on account of death or Disability, any unvested Shares with a vesting date that is during the period of six (6) months beginning on the date of termination of Service shall become vested on the date of termination of Service and any remaining unvested Shares forfeited without consideration (other than a refund to the Award Recipient of an amount equal to the lesser of (A) the cash amount, if any, actually paid by the Award Recipient to the Company for the Shares being forfeited and (B) the Fair Market Value of such Shares on the date of forfeiture); and |
8.3 Performance-Based Restricted Stock Awards.
(a) At the time it grants a Performance-Based Restricted Stock Award, the Committee shall establish one or more Performance Goals the attainment of which shall be a condition of the Award Recipient’s right to retain the related Shares. ThePeriod. Such Performance Goals shall be selected from among the following:
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| (i) earnings per share; |
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| (ii) net income; |
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| (iii) EBITDA; |
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| (iii) return on equity; |
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| (iv) return on assets; |
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| (v) core earnings; |
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| (vi) stock price; |
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| (vii) strategic business objectives, consisting of one or more objectives based on meeting specified cost targets, business expansion goals, goals relating to acquisitions or divestitures, revenue targets or business development goals; |
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| (viii) except in the case of a Covered Employee, any other performance criteria established by the Committee; |
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| (ix) any combination of (i) through (viii) above. |
(i) Earnings per share;
(ii) Pretax income;
(iii) Net income;
(iv) Return on average equity;
(v) Return on average assets;
(vi) Return on capital;
(vii) Core earnings;
(viii) Stock price;
(ix) strategic business objectives, consisting of one or more objectives based on meeting specified cost targets, business expansion goals, goals relating to acquisitions or divestitures, revenue targets or business development goals; or
(x) any combination of (i) through (ix) above.
Performance Goals may be established on the basis of reported earnings or cash earnings, and consolidated results or individual business units and may, in the discretion of the Committee, include or exclude extraordinary itemsand/or the results of discontinued operations. Each Performance Goal may be expressed on an absoluteand/or relative basis, may be based on or otherwise employ comparisons based on internal targets, the past performance of the CompanyCorporation (or individual business units)and/or the past or current performance of other companies.
(b) At the time it grants a Performance-Based Restricted Stock
(c) Reduction or Elimination of Performance Award. The Performance Award the Committee shall establish a Performance Measurement Period for each Performance Goal. The Performance Measurement Period shallParticipant may be the period over which the Performance Goal is measured and its attainment is determined. If the Committee establishes a Performance Goal but fails to specify a Performance Measurement Period, the Performance Measurement Period shall be:
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| (i) if the Performance-Based Restricted Stock Award is granted during the first three months of the Company’s fiscal year, the fiscal year of the Company in which the Performance-Based Restricted Stock Award is granted; and |
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| (ii) in all other cases, the period of four (4) consecutive fiscal quarters of the Company that begins with the fiscal quarter in which the Performance-Based Restricted Stock Award is granted. |
(c) Within a reasonable period of time as shall be determinedreduced or eliminated by the Committee following the end of each Performance Measurement Period, the Committee shall determine, on the basis of such evidence as it deems appropriate, whether the Performance Goals for such Performance Measurement Period have been attained and, if they have been obtained, shall certify such fact in writing.
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(d) If the Performance Goals for a Performance-Based Restricted Stock Award have been determined by the Committee to have been attained and certified, the Committee shall either:
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| (i) if the relevant vesting date has occurred, cause the ownership of the Shares subject to such Restricted Stock Award, together with all dividends and other distributions with respect thereto that have been accumulated, to be transferred on the stock transfer records of the Company, free of any restrictive legend other than as may be required by applicable law, to the Award Recipient; |
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| (ii) in all other cases, continue the Shares in their current status pending the occurrence of the relevant vesting date or forfeiture of the Shares. |
If any one or more of the relevant Performance Goals have been determined by the Committee to not have been attained, all of the Shares subject to such Restricted Stock Award shall be forfeited without consideration (other than a refund to the Award Recipient of an amount equal to the lesser of (A) the cash amount, if any, actually paid by the Award Recipient to the Company for the Shares being forfeited and (B) the Fair Market Value of such Shares on the date of forfeiture).
(e) If the Performance Goals for any Performance Measurement Period shall have been affected by special factors (including material changes in accounting policies or practices, material acquisitions or dispositions of property, or other unusual items) that in the Committee’s judgment should or should not be taken into account, in whole or in part, in the equitable administration of the Plan, the Committee may, for any purpose of the Plan, adjust such Performance Goals and make payments accordingly under the Plan; provided, however, that any adjustments made in accordance with or for the purposes of this section 8.3(e) shall be disregarded for purposes of calculating the Performance Goals for a Performance-Based Restricted Stock Award to a Covered Employee if and to the extent that such adjustments would have the effect of increasing the amount of a Restricted Stock Award to such Covered Employee.
8.4 Dividend Rights. Unless the Committee determines otherwise with respect to any Restricted Stock Award and specifies such determination in the relevant Award Notice, any dividends or distributions declared and paid with respect to Shares subject to the Restricted Stock Award, whether or not in cash, shall be held and accumulated for distribution at the same time and subject to the same terms and conditions as the underlying Shares.
8.5 Voting Rights. Unless the Committee determines otherwise with respect to any Restricted Stock Award and specifies such determination in the relevant Award Notice, voting rights appurtenant to the Shares subject to the Restricted Stock Award, shall be exercised by the Committee in its discretion.
8.6 Tender Offers. Each Award Recipient shall have the right to respond, or to direct the response, with respect to the issued Shares related to its Restricted Stock Award, to any tender offer, exchange offer or other offer made to the holders of Shares. Such a direction for any such Shares shall be given by completing and filing, with the inspector of elections, the trustee or such other person who shall be independent of the Company as the Committee shall designate in the direction, a written direction in the form and manner prescribed by the Committee. If no such direction is given, then the Shares shall not be tendered.
8.7 Designation of Beneficiary. An Award Recipient may designate a Beneficiary to receive any unvested Shares that become available for distribution on the date of his death. Such designation (and any change or revocation of such designation) shall be made in writing in the form and manner prescribed by the Committee. In the event that the Beneficiary designated by an Award Recipient dies prior to the Award Recipient, or in the event that no Beneficiary has been designated, any vested Shares that become available for distribution on the Award Recipient’s death shall be paid to the executor or administrator of the Award Recipient’s estate, or if no such executor or administrator is appointed within such time as the Committee in its sole discretion, shall deem reasonable, to such one or more of the spouse and descendants and blood relatives of such deceased person as the Committeebut under no circumstances may select.
8.8 Taxes. The Company or the Committee shall have the right to require any person entitled to receive Shares pursuant to a Restricted Stock Award to pay the amount of any taxPerformance Award to any Participant be increased. In determining whether a Performance Award will be reduced or eliminated, the Committee shall consider any extraordinary changes which ismay occur during the Performance Period, such as changes in accounting practices or applicable law, extraordinary items of gain or loss, discontinued operations, restructuring costs, sales or dispositions of assets and acquisitions, and shall consider such individual or business performance criteria that it deems appropriate, including, but not limited to, the Corporation’s cash flow, net income, pre-tax income, net revenue, EBITDA, operating income, diluted earnings per share, earnings per share, margin, return on assets, return on equity, cost reductions or savings, funds from operations, appreciation in the Corporation’s stock price, and other relevant operating and strategic business results applicable to an individual Participant.
7. PAYMENT OF PERFORMANCE AWARDS. Subject to any shareholder approval required by law, payment of any Performance Award to a Participant for any Performance Period shall be withheldmade in cash after written certification by the Committee that the Performance Goal for the Performance Period was achieved, and any other material terms of the Performance Award were satisfied.
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with respect to such Shares, or, in lieu thereof, to retain, or to sell without notice, a sufficient number of Shares to cover the amount required to be withheld.
9. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER.
Subject to any required action by the shareholders of the Company, in the event any recapitalization, forward or reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, or exchange of Class A Common Stock or other securities, stock dividend or other special and nonrecurring dividend or distribution (whether in the form of cash, securities or other property), liquidation, dissolution, or other similar corporate transaction or event, affects the Class A Common Stock such that an adjustment is appropriate in the Committee’s discretion in order to prevent dilution or enlargement of the rights of Optionees and Award Recipients under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and kind of shares of Class A Common Stock or other securities deemed to be available thereafter for grants of Options and Restricted Stock Awards under the Plan in the aggregate to all eligible individuals and individually to any one eligible individual, (ii) the number and kind of shares of Class A Common Stock or other securities that may be delivered or deliverable in respect of outstanding Options or Restricted Stock Awards, and (iii) the exercise price of Options. In addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria included in, Options and Restricted Stock Awards (including, without limitation, cancellation of Options or Restricted Stock Awards in exchange for the in-the-money value, if any, of the vested portion thereof, or substitution of Options or Restricted Stock Awards using stock of a successor or other entity) in recognition of unusual or nonrecurring events (including, without limitation, events described in the preceding sentence) affecting the Company or any Subsidiary or the financial statements of the Company or any Subsidiary, or in response to changes in applicable laws, regulations, or account principles; provided, however, that any such adjustment to an Option or Performance-Based Restricted Stock Award granted to a Covered Employee with respect to the Company or its Parent or Subsidiaries shall conform to the requirements of section 162(m) of the Code and the regulations thereunder then in effect. In addition, each such adjustment with respect to an Incentive Stock Option shall comply with the rules of Section 424(a) of the Code (or any successor provision), and in no event shall any adjustment be made which would render any Incentive Stock Option granted hereunder other than an “incentive stock option” as defined in Section 422 of the Code. The Committee’s determination shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Class A Common Stock subject to an Option or Restricted Stock Award.
In the event of the proposed dissolution or liquidation of the Company, or in the event of a proposed sale of all or substantially all of the assets of the Company, or the merger of the Company with or into another corporation, the Committee or the Board of Directors may determine, in its discretion, that (i) if any such transaction is effected in a manner that holders of Class A Common Stock will be entitled to receive stock or other securities in exchange for such shares, then, as a condition of such transaction, lawful and adequate provision shall be made whereby the provisions of the Plan and the Options granted hereunder shall thereafter be applicable, as nearly equivalent as may be practicable, in relation to any shares of stock or securities thereafter deliverable upon the exercise of any Option or (ii) the Option will terminate immediately prior to the consummation of such proposed transaction. The Committee or the Board of Directors may, in the exercise of its sole discretion in such instances, declare that any Option shall terminate as of a date fixed by the Committee or the Board of Directors and give each Optionee or Transferee, if applicable, the right to exercise his Option as to all or any part of the Optioned Stock, including Shares as to which the Option would not otherwise be exercisable; provided, however, that the Committee may, at any time prior to the consummation of such merger, consolidation or other business reorganization, direct that all, but not less than all, outstanding Options be cancelled as of the effective date of such merger, consolidation or other business reorganization in exchange for a cash payment per optioned Share equal to the excess (if any) of the value exchanged for an outstanding Share in such merger, consolidation or other business reorganization over the exercise price of the Option being cancelled.
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In the event of any merger, consolidation, or other business reorganization in which the Company is not the surviving entity, any Restricted Stock Award with respect to which Shares had been awarded to an Award Recipient shall be adjusted by allocating to the Award Recipient the amount of money, stock, securities or other property to be received by the other shareholders of record, and such money, stock, securities or other property shall be subject to the same terms and conditions of the Restricted Stock Award that applied to the Shares for which it has been exchanged.
Without limiting the generality of the foregoing, the existence of outstanding Options or Restricted Stock Awards granted under the Plan shall not affect in any manner the right or power of the Company to make, authorize or consummate (i) any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business; (ii) any merger or consolidation of the Company; (iii) any issuance by the Company of debt securities or preferred or preference stock that would rank above the Shares subject to outstanding Options or Restricted Stock Awards; (iv) the dissolution or liquidation of the Company; (v) any sale, transfer or assignment of all or any part of the assets or business of the Company; or (vi) any other corporate act or proceeding, whether of a similar character or otherwise.
10. TIME FOR GRANTING OPTIONS AND RESTRICTED STOCK AWARDS. The date of grant of an Option or Restricted Stock Award shall, for all purposes, be the date on which the Committee makes the determination granting such Option or Restricted Stock Award or such later date as the Committee may specify. Notice of the determination shall be given to each Optionee or Award Recipient within a reasonable time after the date of such grant.
11.8. PLAN AMENDMENT AND TERMINATION OF THE PLAN.TERMINATION.
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(a) Committee Action; Shareholders’ Approval. Subject to applicable laws and regulations, the Committee or the Board of Directors may amend or terminate the Plan from time to time in such respects as the Committee or the Board of Directors may deem advisable, without the approval of the Company’sCorporation’s shareholders.
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(b) Effect of Amendment or Termination. No amendment or termination or modification of the Plan shall inmay impair the rights of a Participant to any manner affectPerformance Award already granted with respect to any OptionPerformance Period. The reduction or Restricted Stockelimination of a Performance Award theretofore granted without the consent of the Optionee or Award Recipient, except that the Committee or the Board of Directors may amend or modify the Plan in a manner that does affect Options or Restricted Stock Awards theretofore granted upon a finding by the Committee or the Board of Directors that such amendment or modification is in the best interest of Shareholders, Optionees or Award Recipients.
12. CONDITIONS UPON ISSUANCE OF SHARES. Sharespursuant to Section 6(c) shall not be issued pursuant to the exercise ofdeemed an Optionamendment, termination or delivered with respect to a Restricted Stock Award unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto or the grant of a Restricted Stock Award and the delivery of Shares with respect thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance.
As a condition to the exercise of an Option, grant of a Restricted Stock Award or delivery of Shares with respect to a Restricted Stock Award, the Company may require the Person exercising such Option or acquiring such Shares or Restricted Stock Award to represent and warrant at the time of any such exercise, grant or acquisition that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by anymodification of the aforementioned relevant provisions of law. The Company shall not be required to deliver any Shares under the Plan prior to (i) the admission of such Shares to listing on any stock exchange on which Shares may then be listed, or (ii) the completion of such registration or other qualification under any state or federal law, rule or regulation as the Committee shall determine to be necessary or advisable.Plan.
13. RESERVATION OF SHARES. The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan. Inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is
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deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such shares as to which such requisite authority shall not have been obtained.
14. STOCK OPTION AGREEMENT; AWARD NOTICE. Options shall be evidenced by written option agreements and Restricted Stock Awards shall be evidenced by Award Notices, each in such form as the Board of Directors or the Committee shall approve.
15. 9. SHAREHOLDER APPROVAL. Continuance of the Plan shall be subject to approval by the shareholders of the CompanyCorporation entitled to vote thereon within twelve months afterat the date2006 Annual Meeting of Shareholders of the Plan is adopted. If such shareholder approval is obtained at a duly held shareholders’ meeting, it may be obtainedCorporation (or any adjournment thereof) by the affirmative vote of the holders of outstanding shares of the Company’sCorporation’s common stock representing a majority of the votes entitled to be cast thereon. No Performance-Based Restricted StockPerformance Awards shall be granted after the fifth (5th)(5th) anniversary of the date the Plan is adopted unless, prior to such date, the listing of permissible Performance Goals set forth in Section 8.36(b) shall have been re-approved by the shareholders of the CompanyCorporation in the manner required by Section 162(m) of the Code and the regulations thereunder.
16. OTHER PROVISIONS. The Stock Option Agreements or Award Notices authorized under the Plan may contain such other provisions, including, without limitation, restrictions upon the exercise of the Option or vesting of the Restricted Stock Award, as the Board of Directors or the Committee shall deem advisable. Any Incentive Stock Option Agreement shall contain such limitations and restrictions upon the exercise of the Incentive Stock Option as shall be necessary in order that such Option will be an incentive stock option as defined in Section 422 of the Code.
17. 10. INDEMNIFICATION OF COMMITTEE MEMBERS. In addition to such other rights of indemnification they may have as directors, the members of the Committee shall be indemnified by the CompanyCorporation against the reasonable expenses, including attorneys’ fees actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal thereon, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan or any Option or Restricted StockPerformance Award granted thereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal counsel selected by the Company)Corporation) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such Committee member is liable for gross negligence or misconduct in the performance of his duties; provided that within sixty (60) days after institution of any such action, suit or proceeding a Committee member shall in writing offer the CompanyCorporation the opportunity, at its ownthe Corporation’s expense, to handle and defend the same.
18. NO OBLIGATION TO EXERCISE OPTION.
11. WITHHOLDING. The granting of an OptionCorporation will withhold from any amounts payable under this Plan all federal, state, foreign, city and local taxes as shall impose no obligation upon the Optioneebe legally required.
12. OTHER COMPENSATION PLANS. Payments or benefits provided to exercise such Option.
19. WITHHOLDINGS; TAX MATTERS.
19.1 The Company shall have the right to deduct from all amounts paida Participant under any stock, deferred compensation, savings, retirement or other employee benefit plan are governed solely by the Company in cash with respect to an Option under the Plan any taxes required by law to be withheld with respect to such Option. Where any Person is entitled to receive Shares pursuant to the exercise of an Option, the Company shall have the right to require such Person to pay to the Company the amount of any tax which the Company is required to withhold with respect to such Shares, or, in lieu thereof, to retain, or to sell without notice, a sufficient number of Shares to cover the minimum amount required to be withheld. To the extent determined by the Committee and specified in the Option Agreement, an Option holder shall have the right to direct the Company to satisfy the minimum required federal, state and local tax withholding by reducing the number of Shares subject to the Option (without issuanceterms of such Shares to the Option holder) by a number equal to the quotient of (a) the total minimum amount of required tax withholding divided by (b) the excess of the Fair Market Value of a Share on the Option exercise date over the Option exercise price per Share.
19.2 If and to the extent permitted by the Committee and specified in an Award Notice for a Restricted Stock Award other than a Performance-Based Restricted Stock Award, an Award Recipient may be permitted or required to make an election under section 83(b) of the Code to include the compensation related thereto
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in income for federal income tax purposes at the time of issuance of the Shares to such Award Recipient instead of at a subsequent vesting date. In such event, the Shares issued prior to their vesting date shall be issued in certificated form only, and the certificates therefor shall bear the following legend:
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| The Class A Common Stock evidenced hereby is subject to the terms of a Restricted Stock Award agreement between BFC Financial Corporation and [Name of Recipient] dated [Date] made pursuant to the terms of the BFC Financial Corporation 2005 Stock Incentive Plan, copies of which are on file at the executive offices of BFC Financial Corporation, and may not be sold, encumbered, hypothecated or otherwise transferred except in accordance with the terms of such Plan and Agreement. | |
or such other restrictive legend as the Committee, in its discretion, may specify. In the event of the Award Recipient’s termination of Service prior to the relevant vesting date or forfeiture of the Shares for any other reason, the Award Recipient shall be required to return all forfeited Shares to the Company without consideration therefor (other than a refund to the Award Recipient of an amount equal to the lesser of (A) the cash amount, if any, actually paid by the Award Recipient to the Company for the Shares being forfeited and (B) the Fair Market Value of such Shares on the date of forfeiture).
20. OTHER COMPENSATION PLANS.plan. The adoption of the Plan shall not affect any other stock option or incentive or other compensation plans in effect for the Company or any Subsidiary,such plan, nor shall the Plan preclude the CompanyCorporation from establishing any other forms of incentive or other compensation for employeesplans.
13. NO EMPLOYMENT RIGHTS. The Plan does not constitute a contract of employment and directorsparticipation in the Plan will not give a Participant the right to continue in the employ of the CompanyCorporation on a full-time, part-time, or any Subsidiary.
21. SINGULAR, PLURAL; GENDER. Whenever used herein, nounsother basis. Participation in the singular shall includePlan will not give any Participant any right or claim to any benefit under the plural, andPlan, unless such right or claim has specifically been granted by the masculine pronoun shall includeCommittee under the feminine gender.
22. HEADINGS, ETC. NO PART OF PLAN. Headings of Articles and Sections hereof are inserted for convenience and reference; they constitute no partterms of the Plan.
23. SEVERABILITY. If any provision
14. UNFUNDED PLAN. Performance Awards under the Plan will be paid from the general assets of the Corporation and the Corporation shall have no obligation to reserve or otherwise fund in advance any amounts that are or may in the future become payable under the Plan. The rights of Participants under the Plan is held toshall be invalid or unenforceable by a courtonly those of competent jurisdiction, then such invalidity or unenforceability shall not affect the validity and enforceabilitygeneral unsecured creditors of the other provisionsCorporation.
15. GOVERNING LAW. Except to the extent superseded by the laws of the Plan andUnited States, the provision held to be invalid or unenforceable shall be enforced as nearly as possible accordinglaws of the State of Florida, without regard to its original termsconflict of laws principles, shall govern in all matters relating to the Plan.
16. INTERESTS NOT TRANSFERABLE. Except as expressly provided by the Committee, interests of Participants under the Plan may not be sold, transferred, alienated, assigned or encumbered, other than by will or pursuant to the laws of descent and intent to eliminate such invalidity or unenforceability.distribution.
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