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The next joint business activity by Kellen and Pace occurred
either in late 1979 or early 1980 when Pace asked Kellen for
assistance in locating desert property with a good water supply
that would be suitable for growing jojoba. Kellen directed Pace
to land located in Desert Center and Blythe, California, which
had an unlimited water supply for agricultural purposes. Since
1974 Kellen had been actively involved in efforts to develop the
land in this area agriculturally. According to Kellen, he was
actively involved in the development of alfalfa, citrus, jojoba,
grapes, and asparagus. Nevertheless, the private placement
memorandum used to promote Utah I characterized Kellen as having
"no previous experience" with respect to jojoba beans. The
maximum amount of land that Kellen owned at any one time in the
Desert Center and Blythe areas was 4,000 to 6,000 acres.
Pace was pleased with the characteristics of the land Kellen
showed him in Desert Center, California, and thought it would be
a good location for growing jojoba. In 1980, the Sterling Trust,
which had been established by Pace, purchased 400 acres of
property in Desert Center, California. The Sterling Trust was an
inter vivos trust in which Pace was both the grantor and the
beneficiary. At trial, Pace was not able to recall the name of
the individual who sold the property to the Sterling Trust.
Kellen served and continues to serve as trustee of the Sterling
Trust. Kellen also served as a director of U.S. Agri before he
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