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the American Society of Appraisers for approximately 15 years but
is now a member of the Institute of Business Appraisers.
Wildt's ultimate analysis and conclusion was that the
agreements possessed a value of $1.209 million. In his report,
Wildt estimated petitioner's cash-flow for the 5-year lives of
the agreements with the assumption that the agreements were in
force and that Scherer did not contest in the same market.
Then, he estimated the cash-flow over the same time period based
on the assumption that Scherer was in direct competition with
petitioner, and the likelihood of that particular factor.
In his report, Wildt determined that the effect of
competition by Scherer would decrease over the life of the
covenant. Wildt analyzed 15 factors to determine the extent and
magnitude of competition from Scherer. Finally, Wildt determined
that petitioner would enjoy tax benefits from the amortization
deductions available for the agreements.
Here, we do not agree with either party in all respects. In
that regard, we find that the experts provided some useful,
although limited, help in our examination and appraisal.
Nevertheless, we are not significantly persuaded by any one of
the experts. The parties' experts, in general, utilized the
discounted cash-flow method in valuing the covenant not to
compete and the secrecy agreement. In other words, the experts
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