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Agricultural Investments, Inc., which was to be the “manager” of
the project.
Hilltop (as well as Mesa and Hilltop Ventures) was
controlled by four individuals. These individuals were Mr.
Meinke (president, director, and shareholder), Keith A. Damer
(vice president, secretary, director, and shareholder), Marlin G.
Peterson (vice president, treasurer, director, and shareholder),
and Cecil R. Almand (shareholder). The three officer/directors
of Hilltop were all listed as certified public accountants with
expertise in the tax field. The private placement memorandum
listed no experience of any of the officer/directors or
shareholders which is relevant to the farming of jojoba.
The private placement memorandum contained language
specifically alerting investors to the planned deduction of the
“research and development” costs, as well as other tax risks
involved in making an investment in the partnership. The
document also contained an opinion letter stating that the
research and development agreement contained therein met the
requirements of section 174. A copy of this document was
distributed to petitioner, but she did not thoroughly review it.
Potential investors were required to provide information
concerning any previous experience in tax shelter investments,
and the subscription agreement required investors to initial a
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Last modified: May 25, 2011