June 27, 2011
June 27, 2011
Office of the Chief Counsel
Division of Corporation Finance
Securities Exchange Commission
100 F Street, N.W.
Washington, D.C. 20549
BF Enterprises, Inc. Application under Section 12(h) of the Exchange Act - File 81-937
Ladies and Gentlemen:
I write in reference to a letter to you from Alexander F. Cohen, an attorney for BF Enterprises, Inc., dated June 21, 2011 with respect to the above-referenced application.
In his letter, Mr. Cohen claims that the Company's stockholders had ample disclosure and a lengthy opportunity to obtain liquidity if they did not want to participate as investors in a private company. He then refers to those that chose to remain stockholders, as though all shareholders had a free choice between attractive options.
To the extent that this leads a reader to believe that all of the Company's minority shareholders in 2005 had a choice between receiving fair value for their shares in cash or continuing to hold shares in a private company, that would be a misleading inference indeed. In fact, shareholders who held fewer than 3,000 shares were frozen out at a price determined by the Company, $8.95 per share. (As a result of the settlement of litigation subsequently brought against the Company by such shareholders, the amount of that consideration was eventually augmented materially, to $11.34 per share.) Many larger shareholders had no effective opportunity whatsoever to receive fair value for their shares. As a practical matter, their choice was between selling into a market at a price which they believed – correctly – did not reflect the intrinsic value of their shares, or continuing their ownership in the Company at the cost of losing the benefits of registration and protection of shareholders under the Exchange Act.
For Mr. Cohen to crow about such shareholders' enjoyment of dividends which have aggregated $2.45 per share since 2005 is particularly misleading. In fact, such shareholders see the cruel contrast between the $11.34 per share eventually received by small shareholders who were frozen out in 2005 and today's $5.00 per share bid price for Company shares. Even after considering the dividends paid by the Company since 2005, such shareholders have nothing for which to be thankful. (Or does Mr. Cohen believe, perhaps, they should enjoy the fact that their losses were not even greater?)
Daniel F. Raider
cc: Shareholders of BF Enterprises, Inc.