- 12 - 1216 (6th Cir. 1993), involved Sentinel expanded polyethylene (EPE) recyclers. However, the EPS recycler partnerships and the EPE recycler partnerships are essentially identical. See Davenport Recycling Associates v. Commissioner, T.C. Memo. 1998-347, * * * affd. 220 F.3d 1255, * * * (11th Cir. 2000); see also Gottsegen v. Commissioner, T.C. Memo. 1997-314 * * * (involving both the EPE and EPS recyclers); Ulanoff v. Commissioner, T.C. Memo. 1999-170 * * * (same). A. The Private Offering Memorandum In Barber v. Commissioner, supra, significant portions of the Whitman offering memorandum were summarized as follows: By a private placement offering memorandum dated September 28, 1982 (the offering memorandum), subscriptions for 18 limited partnership units in Whitman were offered by the partnership’s promoter to potential limited partners at $50,000 per partnership unit. Pursuant to the offering memorandum, the limited partners would own 99 percent of Whitman and the general partner, Sam Winer, would own the remaining 1 percent. Also pursuant to the offering memorandum, each limited partner was required to have a net worth (including residence and personal property) in excess of $1 million, or net income in excess of $200,000, for each investment unit. The offering memorandum stated that Winer would receive $62,000 for administrative and other services to be paid from the proceeds of the private placement offering as “management fees”. The offering memorandum also stated that the partnership would pay “fees of purchaser representatives and selling commissions” from the proceeds of the offering in an amount equal to 10 percent of the aggregate price of the units. Thus, Winer would earn a 10-percent commission upon selling an interest in the partnership. In addition, the offering memorandum stated that Winer could “retain as additional compensation all amounts not paid as purchaser representative fees or sales commissions in connection with the Offering”. The face of the offering memorandum warned, in bold capital letters, that “THIS OFFERING INVOLVES A HIGH DEGREE OF RISK”. The offering memorandum also warned that “An investment in the partnership involves a high degree of business and tax risks and should,Page: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Next
Last modified: May 25, 2011