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party to the contract and the licensee thereunder.
E. U.S. Agri and Eugene Pace
As previously indicated, the offering memorandum identified
U.S. Agri as the R&D contractor under the R&D contract and as the
licensee under the license agreement. U.S. Agri was also the R&D
contractor and the licensee for Utah Jojoba, Blythe Jojoba I,
Blythe Jojoba II, and Desert Center Jojoba.
The president of U.S. Agri was Eugene Pace (Mr. Pace), who
was also a member of its board of directors. Petitioner also
served as a member of U.S. Agri’s board until he became general
partner of Utah Jojoba, Blythe Jojoba I, Blythe Jojoba II, and
Desert Center Jojoba in late 1982.
At the time that petitioner invested in San Nicholas, he and
Mr. Pace had been personal friends and business associates for a
number of years.
F. Cautionary Language in the San Nicholas Offering Memorandum
The face of the offering memorandum warned, in block
letters, that “THIS OFFERING INVOLVES A HIGH DEGREE OF RISK”.
The offering memorandum also included the following cautionary
language in block letters:
PROSPECTIVE INVESTORS ARE CAUTIONED NOT TO CONSTRUE
THIS MEMORANDUM OR ANY PRIOR OR SUBSEQUENT
COMMUNICATIONS AS CONSTITUTING LEGAL OR TAX ADVICE.
* * * INVESTORS ARE URGED TO CONSULT THEIR OWN COUNSEL
AS TO ALL MATTERS CONCERNING THIS INVESTMENT.
* * * * * * *
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