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in the partnership. Zion was required to make an initial
contribution of $108,014 for its 6.66-percent interest in the
partnership. In the event of certain circumstances, the partners
agreed to make additional contributions to the partnership. The
partnership agreement provided that the partnership would
reimburse or credit the capital accounts of the Frey corporation,
Frey, Wold, and Zion for "the advances made by them in
negotiating, entering into and performing the terms and
conditions of Purchase and Sale Contract and Contractual
Commitments".
Following Prudential's sale of the Village of Kings Creek
property, the executive in the Miami regional office who had
dealt with Frey in the sale approached Frey about converting
another Prudential apartment property in Florida into
condominiums. Beginning with this property, Prudential
participated in a number of successful condominium conversion
projects with Frey. Most of these projects that Frey and
Prudential undertook were joint ventures.
Frey did not have to raise much capital to engage in these
joint venture projects with Prudential, because Prudential owned
the apartment property to be converted and participated as co-
owner in a joint venture to convert and sell the property as
condominium units. Prudential would contribute the property and
receive (1) all initial condominium unit sale proceeds up to a
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