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general partner, who had limited experience in marketing
recycling or similar equipment; (4) the limited partners would
have no control over the conduct of the partnership’s business;
(5) there were no assurances that market prices for virgin resin
would remain at their current costs per pound or that the
recycled pellets would be as marketable as virgin pellets; and
(6) certain potential conflicts of interest existed.
The offering memorandum informed investors that the Whitman
transactions would be executed simultaneously.
The offering memorandum prominently touted the anticipated
tax benefits for the initial year of investment for an investor
in the partnership. In this regard, the offering memorandum
stated, in part, as follows:
The principal tax benefits expected from an
investment in the Partnership are to be derived from
the Limited Partner’s share of investment and energy
tax credits and tax deductions expected to be generated
by the Partnership in 1982. The tax benefits on a per
Unit basis are as follows:
Projected
Regular Investment Projected Tax
Payment and Energy Tax Credits Deductions
1982 $50,000 $77,000 $38,940
The Limited Partners are not liable for any additional
payment beyond their cash investment for their Units,
nor are they subject to any further assessment.
The offering memorandum also included a tax opinion prepared
by the law firm of Boylan & Evans concerning tax issues involved
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Last modified: May 25, 2011