TORTOLA, British Virgin Islands, Jan. 11 /PRNewswire-FirstCall/ -- Chardan 2008 China Acquisition Corp. (Nasdaq: CACA, CACAU, CACAW) today announced that shareholders approved the acquisition of a controlling interest in DAL Group, LLC ("DAL") at a meeting that took place today at the offices of Chardan's lawyers in New York City and that the acquisition and all proposals presented at the meeting were approved with fewer than 0.5% of outstanding public shares electing to redeem their shares.
At the closing of the acquisition, expected to be on or before Friday, January 15, DAL will own 100% of the business and operations of Default Servicing, Inc. ("DSI") and Professional Title & Abstract Company of Florida ("PTA") and the non-legal operations supporting the foreclosure and other legal proceedings handled by the Law Offices of David J. Stern, P.A. ("DJS") (collectively referred to as the "Company"). In addition, at that closing Chardan will change its name to DJSP Enterprises, Inc. ("DJSP"), and its stock is expected to continue to trade on NASDAQ under the symbols DJSP, DJSPU, and DJSPW.
Kerry Propper, Chairman of Chardan, stated that, "We are happy that shareholders overwhelmingly approved the transaction and we look forward to helping the Company expand and grow in the coming years."
At closing, DJSP will be one of the largest providers of processing services for the mortgage and real estate industries in Florida and one of the largest in the United States. The Company provides a wide range of processing services in connection with mortgages, mortgage defaults, title searches and abstracts, REO (bank-owned) properties, loan modifications, title insurance, loss mitigation, bankruptcy, related litigation and other services. The Company's clients include all of the top 10 and 17 of the top 20 mortgage servicers in the United States, many of which have been customers for more than 10 years. The Company has approximately 1000 employees and is headquartered in Plantation, Florida, with additional operations in Louisville, Kentucky and San Juan, Puerto Rico. The Company's U.S. operations are supported by a scalable, low-cost back office operation in Manila, the Philippines that provides data entry and document preparation support for the U.S. operation.
The Company has experienced rapid growth over the past four years, increasing revenues from approximately $40 million in 2006 to approximately $199 million in 2008, while increasing net income, on a pro forma basis, for the same two periods from approximately $7 million to approximately $39 million. The Company had revenues of approximately $117 million for the 6 months ended June 30, 2009 and an adjusted pro forma net income for that period of $22 million, signaling continued growth.
Please see Chardan's press release dated December 14, 2009 and the proxy statement relating to the extraordinary meeting (filed with the SEC on December 29, 2009) for additional information on the Company.
Chardan was formed in February 2008 for the purpose of acquiring a controlling interest in an unidentified operating business. Additional information about Chardan is available in Chardan's public filings available from the SEC website: (http://www.sec.gov).
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, about Chardan, DAL, the Company, DJSP and their combined business after completion of the proposed acquisition. Forward looking statements are statements that are not historical facts. Such forward-looking statements, based upon the current beliefs and expectations of Chardan and the Company's management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions, changing interpretations of generally accepted accounting principles; outcomes of government or other regulatory reviews, particularly those relating to the regulation of the practice of law; the impact of inquiries, investigations, litigation or other legal proceedings involving DJSP, which, because of the nature of the Company's business, have happened in the past to the Company and DJS; the impact and cost of continued compliance with government or state bar regulations or requirements; legislation or other changes in the regulatory environment, particularly those impacting the mortgage default industry; unexpected changes adversely affecting the businesses in which the Company is engaged; fluctuations in customer demand; the Company's ability to manage rapid growth; intensity of competition from other providers in the industry; general economic conditions, including improvements in the economic environment that slows or reverses the growth in the number of mortgage defaults, particularly in the State of Florida; the ability to efficiently expand its operations to other states or to provide services not currently provided by the Company; the impact and cost of complying with applicable SEC rules and regulation, many of which DJSP will have to comply with for the first time after the closing of the business combination; geopolitical events and changes, as well as other relevant risks detailed in Chardan's filings with the U.S. Securities and Exchange Commission, (the "SEC"), including its report on Form 20-F for the period ended December 31, 2008 and the Form 6-K filed with the SEC containing the proxy statement relating to the business combination which was mailed to shareholders of Chardan. The information set forth herein should be read in light of such risks. Chardan, DAL and the Company do not assume any obligation to update the information contained in this press release.
Non-GAAP Financial Measures
The financial information and data contained in this press release are unaudited and do not conform to the SEC's Regulation S-X. Accordingly, such information and data may not be included in, may be adjusted in or may be presented differently in, CACA's proxy statement to solicit stockholder approval for the proposed acquisition. This press release includes certain estimated financial information and forecasts presented as pro forma financial measures that are not derived in accordance with generally accepted accounting principles ("GAAP"), and which may be deemed to be non-GAAP financial measures within the meaning of Regulation G promulgated by the SEC. CACA and management of the acquired business believe that the presentation of these non-GAAP financial measures serve to enhance the understanding of the financial performance of acquired business and the proposed acquisition. However, these non-GAAP financial measures should be considered in addition to and not as substitutes for, or superior to financial measures of financial performance prepared in accordance with GAAP. Our Non-GAAP financial measures may not be comparable to similarly titled pro forma measures reported by other companies. The Non-GAAP measures used herein may not be comparable to similarly titled measures reported by other companies. Such measures are not recognized terms under U.S. GAAP, and should be considered in addition to, and not as substitutes for, or superior to, operating income, cash flows, revenues, or other measures of financial performance prepared in accordance with generally accepted accounting principles. Such measures are not a completely representative measure of either the historical performance or, necessarily, the future potential of DJSP.
Adjusted Net Income - The Company is providing adjusted Net Income, a non-GAAP financial measure, along with GAAP measures, as a measure of profitability because adjusted Net Income allows comparison of past performance with the taxable structure that will be in place after consummation of the transaction. In the calculation of adjusted Net Income, the Company deducts the Depreciation and Amortization amounts to the Adjusted EBITDA calculation and then subtracts the income tax expense from that figure calculated at the expected 'going forward' tax rate of 35%.
SOURCE Chardan 2008 China Acquisition Corp.