Durham Farms #1 - Page 19




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          each partnership.  These herd recap sheets are discussed more               
          fully infra.                                                                
          D.  Some Investors’ Failure To Make Payments                                
               During the period from 1987 through 1992, a large number of            
          investors in the cattle-breeding partnerships the Hoyt                      
          organization had formed (including some investors in certain of             
          the seven cattle-breeding partnerships in the instant cases)                
          failed to continue making the specified payments required of                
          them, including paying their pro rata share of the payments                 
          required under their partnership’s “Full Recourse Promissory                
          Note”.  The Hoyt organization never sought to enforce and hold              
          any of the defaulting investors personally liable for the                   
          payments they had defaulted upon.  These investors were allowed             
          to walk away from their partnership’s “Full Recourse Promissory             
          Note”.                                                                      
          E.  DF #1's, SGE 82-1's, DGE 84-3's, SGE 84-5's, DGE 86-2's, TBS            
          89-1's, and TBS 90-1's Respective Returns for the Years in Issue            
               DF #1's returns for some of the years in issue reflect that            
          it originally claimed depreciation on a “breeding herd” placed in           
          service in 1990, for which its cost or other basis was                      
          $1,123,972.  DF #1 depreciated this breeding herd over 5 years.             
               SGE 82-1's returns for some of the years in issue reflect              
          that it originally claimed depreciation on a “breeding herd”                
          placed in service in 1990, for which its cost or other basis was            
          $1,923,810.  SGE 82-1 depreciated this breeding herd over 12                





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