RE: RE: Binding Arbitration ClaimsFrom the IPO prospectus:
Theselling Physician Limited Partners will place an aggregate of approximately $18million in escrow accounts maintained at an independent Texas financial institution.These funds will secure a portion of such selling Physician Limited Partner’sindemnification obligations with respect to his or her representations andwarranties in favour of Northstar LPco and Northstar GPco. The sellingPhysician Limited Partners will each be entitled to manage the investment ofhis or her escrowed funds, and may annually withdraw up to 40% of the prioryears’ cumulative increase in value of his or her escrowed funds. The escrowedfunds will be released to selling Physician Limited Partners over a four-yearperiod, with 15%, 25%, 30% and 30% of the funds being released from escrow atthe end of each of years one through four, respectively. A Physician LimitedPartner’s escrowed funds will be released in full upon his death or disabilityand will be forfeited in the event the Physician Limited Partner retires priorto the release of the funds.
So based on this wording, the potential liability could be greater than whatever remains in escrow as it says that the funds secure a portion of the indemnification obligations. That being said, I am sure NHC has tried to settle for an amount which is less, Kramer is just being difficult.