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Sav-Fuel was promoted by Mr. Frost, Richard Gangel (Mr.
Gangel), David Dworsky (Mr. Dworsky), Nisona, and Dard. The
promoters have entered into other partnerships that have
attempted to sell and/or commercially exploit computerized energy
management systems similar to that of Sav-Fuel.4 At the time of
the offering, Nisona was recently organized and had minimal
experience in the sale of computerized energy management systems.
Mr. Gangel (and/or trusts on behalf of his family) owned Nisona.
Execusport, Inc.,5 and Mr. Gangel (and/or trusts on behalf of Mr.
Gangel’s family) equally controlled Dard. Mr. Frost had acted as
a general partner in other partnerships that had purchased
similar energy management systems from entities affiliated with
Nisona and Mr. Gangel. At the time of the offering, Mr. Dworsky
was the president and sole shareholder of CEF.
The promoters distributed the PPM to potential investors.
The PPM states that the offering consists of 23 units of limited
partnership interests each requiring a cash payment of $49,900 on
the purchase of an interest6 and the balance of $12,500 by a full
4Another EMS-related activity involving Mr. Frost was the
subject of Gianaris v. Commissioner, T.C. Memo. 1992-642.
5The record does not indicate whether any of the promoters
were affiliated with Execusport, Inc.
6Assuming all 23 units were sold to investors, the total of
the initial cash payments of $49,900 equaled $1,147,700. Of this
amount, $55,200 was intended for legal costs, $13,800 was for
compensation of Mr. Frost, and $20,700 was for working capital.
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