Services.

       Our financial expert team was recently hired to evaluate the fairness of a multi-unit participation sale to a large strategic buyer as a threshold matter in a pending civil litigation.  The clients were the member owners of four retail businesses, herein the ("Entities"), who participated in a thirty unit sale.  The subject of the litigation was a participation agreement, herein the ("Agreement"), which afforded the four units approximately 16% of the total sales proceeds from the larger acquisition deal.  That Agreement made representations and was entered into under the premise that 16% was fair based on the EBITA contribution of those 4 units relative to the other 26.  Consolidated spread sheets were provided to the Entity owners to account for the EBITA contributions per location, but once the transaction was consummated and all monies were sitting in escrow, the Entity owners discovered that the valuation of one of the units, herein ("Unit X"), was not subject to the same valuation methods as the other twenty-nine units.  After the deal was consummated, it was discovered that Unit X, a recent acquisition, was arbitrarily assigned an inflated valuation without carefully looking at its revenue and without projecting a normalized EBITA to match the same methodology for the other units in the deal.  To add insult to injury, Unit Y, had 2.5 months of revenue from Unit X built into its top-line for no good reason except that the same bank account was used to capture that revenue for 2.5 months, post acquisition.  All told, Unit X received an inflated valuation and 2.5 months of Unit X's revenue was double-counted by including it in Unit Y's profit and loss statement for the relevant period.  Given that these two "errors" would result in a significant difference in proceeds to the Entity owners, our law firm partners had filed a civil action in Superior Court and a motion to freeze the monies in escrow.  We were hired to figure out the shortfall to the Entity owners and to craft a financial report explaining our calculations.

       After the deposition of the key-man involved in the acquisition deal, who coincidentally was most likely to benefit from the financial "errors," the law firm was able to subdue the adversary into settling the dispute by coughing-up 24% of the total sales price as opposed to 16%.  This increase of 8% for our clients resulted in a distribution to them of $36M as opposed to $24M, a net benefit of $12M.  No doubt our financial analysis and collaborative work made this net gain possible.  We are proud to report this tremendous win on behalf of our firm.

       In litigation that involves complex financial  issues, the breadth and scope of our work product is unmatched by any other expert in the field.  In the instant matter, we worked with our law firm partner to craft a winning deposition strategy.  The key-man was locked into stating, under oath, the correct revenue for Unit Y for the relevant period.  By obtaining Unit Y's revenue, we were able to accurately derive the 2.5 months of revenue that corresponded to Unit X which was "inadvertently" included in Unit Y's financial statements. By knowing 2.5 months of revenue for Unit X, our team was able to project and forecast twelve months of revenue for Unit X by following a trend analysis of sales by month, on average, for the other 29 locations.  The key-man had adamantly claimed that Unit X's financials were not pertinent because Unit X was a recent acquisition and was previously subject to varying operational expenses.  Presumably the operational platform was different, the vendors were varied, and even the management structure was not the same as in the other 29 units.  Our financial experts disagreed.  We proposed that the revenues were congruent because Unit X was the same type of business as the other units.  We were able to calculate a normalized EBITA for Unit X to arrive at a fair valuation relative to the other units sold in the larger transaction. We used common sized expenses as a percent of sales for all of our known expenses for the other 29 units and derived a normalized EBITA for Unit X which drastically lowered its arbitrary valuation.  By subtracting the 2.5 months of Unit X's revenue stuck in Unit Y's profit and loss statements, the EBITA for Unit Y was decreased substantially.  By decreasing the value of Unit Y and more accurately valuing Unit X, our team was able to re-calculate the correct contribution of our client's four Entities relative to the larger deal.  These results were presented in a report with accompanying spreadsheets that demonstrated our financial model.  The report was so precise and compelling that our law firm partner was able to move swiftly and achieve a settlement on behalf of our clients.  

       NJ Expert Witness is synonymous with accuracy, integrity, and professionalism in the financial industry. We continue to provide expert valuations and advice to attorneys in the area of finance.  Our success in this case serves as a testament to the power of knowledge, diligence, and our unwavering confidence in our financial expertise.

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Note: The names and various details in the summary above were intentionally redacted since the settlement herein was subject to a stringent confidentiality agreement.  As much as we could, we have explained the nature of our work in order to elucidate for you the type of financial analysis and collaboration we can bring to your litigation embroilment.  The use of quotes around words above, such as "error" and "inadvertent" should be interpreted by the reader to mean that we do not believe the adversary committed an innocent error and therefore that same was not inadvertent at all.  The quotes should be interpreted as the writer adding a wink to the use of these words to describe the adversaries actions.