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partnership’s business; (5) there was no established market for
the Sentinel EPS recyclers; (6) there were no assurances that
market prices for virgin resin would remain at then current
prices per pound or that the recycled pellets would be as
marketable as virgin pellets; and (7) certain potential conflicts
of interest existed.
The offering memorandum contained a marketing opinion by
Stanley Ulanoff (Ulanoff) and a technical opinion by Samuel
Burstein (Burstein). Ulanoff owned a 4.37-percent interest in
Taylor Recycling Associates, which purported to lease four
plastic recyclers, and Burstein owned a 5.82-percent interest in
Jefferson Recycling Associates, which also purported to lease
four plastic recyclers. The offering memorandum disclosed that
Burstein was a client of PI’s corporate counsel. The offering
memorandum also warned potential investors not to rely on the
statements and opinions contained in the memorandum, but to
conduct an independent investigation.
The private offering memorandum also projected that in the
initial year of investment an investor contributing $50,000
would receive investment tax credits and business energy credits
of $77,000 and tax deductions of $38,940. The private offering
memorandum provided that an investor in Masters was required to
have an individual net worth and/or net worth with a spouse of
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Last modified: May 25, 2011