Stephen H. Glassley and Judith Glassley, et al. - Page 59

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          acres purportedly allocated to it.  Others had interests in the             
          large areas farmed by HJI in Hyder, so Gross' computation of the            
          valuation for JDP was simply contrary to fact.  Moreover, even              
          Eberhardt states that the results of the nutrient studies were              
          site specific.  Therefore, petitioners' argument that the jojoba            
          industry saved millions of dollars as a result of HJI's putative            
          research or experimentation is outlandish.                                  
               In addition, we view with much skepticism testimony that the           
          parties to these agreements anticipated that JDP would recoup the           
          cost of the R & D contract fee from the increased production of             
          the jojoba plants on Turtleback I resulting from a successful               
          research program.  The record reveals that no one made any                  
          projections before the agreements were executed, or afterward,              
          relating to the profit potential of a 60-acre jojoba plantation.            
          The profit projections in the offering were based on a jojoba               
          plantation's containing a low of 160 acres and a high of 464                
          acres.  The offering, furthermore, cautioned that JDP would face            
          higher risks should only the projected minimum 160 acres be                 
          planted.  Yet, nowhere is any attempt made to show that the                 
          results of operations on the 60 acres purportedly allocated to              
          JDP could support the anticipated 5-year research and                       
          experimentation project to which the parties seemingly bound                
          themselves in the R & D Agreement.  Indeed, Gross admitted in his           
          report that "It is not customary to conduct expensive research              
          and experimentation on a pilot model, and then expect the pilot             




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