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loss and business energy credit related to EI's investment in
Clearwater for 1981.
EI is an Indiana limited partnership that was formed in May
of 1981 by Morton L. Efron (Efron) as the general partner and
Real Estate Financial Corp. (REFC) as the initial limited
partner. Fred Gordon (Gordon) is the president of REFC, which is
owned by members of Gordon's family.
EI was formed to acquire limited partnership interests in an
office building in Buffalo, New York (the office building), and a
shopping center in Haslett, Michigan (the shopping center). In
contemplation of these ventures, EI prepared a private placement
memorandum (the original offering memorandum) and distributed it
to potential limited partners. At some time in late 1981, EI
abandoned the contemplated investment in the shopping center and
substituted limited partnership interests in Clearwater and a K-
Mart shopping center in Swansea, Massachusetts (the K-Mart
investment). The revised investment objectives were presented in
a revised offering memorandum (the revised offering memorandum).
The revised offering memorandum indicated that EI intended to
invest in 100 percent of the limited partnership interests in the
office building (10 units), 43.75 percent of the limited
partnership interests in Clearwater (7 units), and 15.625 percent
4(...continued)
credit.
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