River City Ranches #1 Ltd., Leon Shepard, Tax Matters Partner - Page 29

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          and pay all expenses with respect to each partnership’s breeding            
          sheep.                                                                      
               The dates on which the purchase agreements each of the eight           
          partnerships and Barnes Ranch entered into, the number of                   
          purported breeding ewes each partnership allegedly acquired, the            
          total stated purchase price, and the average price per sheep each           
          partnership agreed to pay for its sheep are as follows:                     
                                             Total                                    
                    Date of   Number     Purchase   Avg. Price                        
          Partnership  Entry     of Ewes    Price      per Sheep                      
          RCR #1      4-20-81      401     $455,100    $1,135                         
          RCR #2      2-15-82      514      626,400     1,219                         
          RCR #3      3-20-83      584      713,140     1,221                         
          RCR #4      2-01-84    1,468    2,087,880     1,422                         
          RCR #5      5-01-85    1,257    1,825,000     1,452                         
          RCR #6      1-15-86    1,415    1,960,140     1,385                         
          RCR #7      2-01-87    1,873    3,982,360     2,126                         
          OGT 87      1-05-87    1,849    3,636,600     1,967                         
          Each of the nine sheep partnerships at issue was supposedly                 
          formed to operate as a sheep breeding partnership, owning its own           
          flock of sheep purchased from Barnes Ranch.  However, Jay Hoyt              
          and David Barnes were not independent parties acting at arm’s               
          length with respect to any of the sheep agreements.  In                     
          actuality, none of the sheep partnerships acquired the benefits             
          and burdens of ownership of any of the sheep listed above.                  
               The bills of sale that Barnes Ranch issued the sheep                   
          partnerships (excluding OGT 90) listed large numbers of                     
          individual breeding sheep that did not exist.  The flock recap              
          sheets prepared by Jay Hoyt contained false information and did             





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