315858--4/13/2010--BFC_FINANCIAL

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Regulatory restrictions, BankAtlantic performance and the terms of indebtedness limit or restrict BankAtlantic Bancorp s ability to pay dividends which may impact our cash flow. The payment of dividends by Bluegreen is not within our control. Dividends and distributions from our subsidiaries to their respective parent companies may be subject to claims in the future from creditors of the subsidiary. There are inherent uncertainties involved in estimates, judgments and assumptions used in the preparation of financial statements in accordance with GAAP. Any changes in estimates, judgments and assumptions used could have a material adverse effect on our financial position and operating results. Our activities and our subsidiaries activities are subject to a wide range of regulatory requirements applicable to financial institutions and holding companies, and noncompliance with such regulations could have a material adverse effect on our business. Certain members of our Board of Directors and certain of our executive officers are also directors and executive officers of our affiliates. Risks Associated with Our Investments in the Restaurant Industry Our portfolio of equity securities and our investments in BankAtlantic Bancorp, Benihana and Bluegreen subjects us to equity pricing risks. Our net operating loss carryforwards will be substantially limited as a result of the Merger with Woodbridge because the Merger resulted in an ownership change as defined in the Internal Revenue Code. Issuance of Additional Securities In The Future. Our control position may adversely affect the market price of BankAtlantic Bancorp s Class A Common Stock and Bluegreen s common stock. Alan B. Levan And John E. Abdo s Control Position May Adversely Affect The Market Price Of Our Common Stock. The terms of our articles of incorporation, which establish fixed relative voting percentages between our Class A Common Stock and Class B Common Stock, may not be well accepted by the market. The loss of the services of our key management and personnel could adversely affect our business. The defaults by Woodbridge and its subsidiaries under the terms of their outstanding indebtedness have resulted in acceleration of the debt and may result in judgments against the obligors. Core has ceased substantially all development operations and may not be successful in achieving an orderly liquidation of its assets. Core utilized community development district and special assessment district bonds to fund development costs, and Core will be responsible for assessments until the underlying property is sold or otherwise transferred. It may be difficult and costly to rent vacant space and space which may become vacant in future periods. If prospective purchasers of assets and tenants are not able to obtain suitable financing, our results of operations may further decline. Product liability litigation and claims that arise in the ordinary course of business may be costly. We are subject to governmental regulations that may limit our operations, increase our expenses or subject us to liability. We are subject to environmental laws and the cost of compliance could adversely affect our business. Levitt and Sons had surety bonds on most of their projects, some of which were subject to indemnity by Woodbridge. The state of the economy, generally, interest rates and the availability of financing affect our ability to market VOIs and residential homesites. We would incur substantial losses if the customers we finance default on their obligations, and new credit underwriting standards may not have the anticipated favorable impact on performance. Our business plan historically has depended on our ability to sell or borrow against our notes receivable to support our liquidity and profitability While we have attempted to restructure our business to reduce our need for and reliance on financing for liquidity in the short term, there is no assurance that such restructuring will be successful or that our business and profitability will not otherwise continue to depend on our ability to obtain financing, which may not be available on favorable terms, or at all. Our results of operations and financial condition could be adversely impacted if our estimates concerning our notes receivable are incorrect. Our future success depends on our ability to market our products successfully and efficiently. We are subject to the risks of the real estate market and the risks associated with real estate development, including the declines in real estate values and the deterioration of real estate sales. Our adoption on January 1, 2010, of recently issued accounting guidance will have a material adverse impact on our net worth, leverage, and book value per share. Claims for development-related defects could adversely affect our financial condition and operating results. The resale market for VOIs could adversely affect our business. We may be adversely affected by extensive federal, state and local laws and regulations and changes in applicable laws and regulations, including with respect to the imposition of additional taxes on operations. Environmental liabilities, including claims with respect to mold or hazardous or toxic substances, could have a material adverse impact on our business. The ratings of third-party rating agencies could adversely impact our ability to obtain, renew, or extend credit facilities, debt, or otherwise raise capital The loss of the services of our key management and personnel could adversely affect our business. BankAtlantic Bancorp has incurred significant losses during the last three years and if BankAtlantic Bancorp continues to incur significant losses BankAtlantic Bancorp will need to raise additional capital, which may not be available on attractive terms, if at all. Continued capital and credit market volatility may adversely affect our ability to access capital and may have a material adverse effect on our business, financial condition and results of operations. BankAtlantic Bancorp has deferred interest on its outstanding junior subordinated debentures and anticipates that it will continue to defer this interest for the foreseeable future which could adversely affect its financial condition and liquidity. BankAtlantic Bancorp s cash offers to purchase $230 million of trust preferred securities issued by statutory business trusts formed by BankAtlantic Bancorp may not be consummated. Historically BankAtlantic Bancorp has relied on dividends from BankAtlantic to service its debt and pay dividends, but no dividends from BankAtlantic are anticipated or contemplated for the foreseeable future. The decline in the Florida real estate market has adversely affected, and may continue to adversely affect, our earnings and financial condition. BankAtlantic s loan portfolio is concentrated in loans secured by real estate, a majority of which are located in Florida, which makes us very susceptible to credit losses given the current depressed real estate market. BankAtlantic s consumer loan portfolio is concentrated in home equity loans collateralized by Florida properties primarily located in the markets where BankAtlantic operates its store network. An increase in BankAtlantic s allowance for loan losses will result in reduced earnings. Adverse events in Florida, where BankAtlantic Bancorp business is currently concentrated, could adversely impact our results and future growth. BankAtlantic s interest-only residential loans expose it to greater credit risks. Nonperforming assets take significant time to resolve and adversely affect our results of operations and financial condition, and could result in further losses in the future. Changes in interest rates could adversely affect our net interest income and profitability. BankAtlantic obtains a significant portion of its non-interest income through service charges on core deposit accounts, and recent legislation designed to limit service charges could reduce our fee income. The cost and outcome of pending legal proceedings may impact our results of operations BankAtlantic has significantly reduced operating expenses over the past three years and BankAtlantic may not be able to continue to reduce expenses without adversely impacting its operations. Deposit insurance premium assessments may increase substantially, which would adversely affect expenses. Further reductions in BankAtlantic s assets may adversely affect our earnings and/or operations. Adverse market conditions have affected and may continue to affect the financial services industry as well as our business and results of operations. Legislative and regulatory actions taken now or in the future may have a significant adverse effect on our financial statements. BankAtlantic Bancorp and BankAtlantic are each subject to significant regulation and BankAtlantic Bancorp s activities and the activities of BankAtlantic Bancorp s subsidiaries, including BankAtlantic, are subject to regulatory requirements that could have a material adverse effect on BankAtlantic Bancorp s business. BankAtlantic is subject to liquidity risk as its loans are funded by its deposits. Our loan portfolio subjects BankAtlantic Bancorp to high levels of credit and counterparty risk. BankAtlantic Bancorp is controlled by BFC Financial Corporation and its controlling shareholders and this control position may adversely affect the market price of BankAtlantic Bancorp s Class A common stock. BFC can reduce its economic interest in us and still maintain voting control. Provisions in BankAtlantic Bancorp charter documents may make it difficult for a third party to acquire BankAtlantic Bancorp and could depress the price of its Class A Common Stock.

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315858--4/13/2010--BFC_FINANCIAL_CORP