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to a due diligence financial review. On September 24, 1991, Mr.
Forsythe, acting on behalf of Indeck, advised CMS Generation by
letter that Indeck’s obligation to cooperate with Mr. Polsky
under the Shareholders’ Agreement had expired and that, as a
shareholder, he was not interested in selling his shares of
Indeck stock.
Proceedings in the arbitration action brought by Mr. Polsky
had commenced in January 1991 and continued until May 1991. Mr.
Polsky filed a post-arbitration brief in June 1991 in which he
contended that Indeck owed him the value of his shares as of the
June 1, 1993, expiration of his employment term under the
Employment Agreement. Mr. Polsky further contended that the
shares would have appreciated to a present value of $56.3 million
at that time, due to anticipated revenues from existing
cogeneration contracts held by Indeck. Alternatively, Mr. Polsky
argued that the January 31, 1991, PowerLink offer of $501,000 per
share set a floor but not a ceiling on the damages to which he
was entitled with respect to his Indeck stock. (The August 6,
1991, CMS Generation offer of $75 million (or $750,000 per share)
was not presented to the arbitrator.) In response, Indeck argued
that the arbitrator lacked jurisdiction with respect to the value
or sale of Mr. Polsky’s shares.
At a meeting in February 1991, Indeck’s board of directors
was advised by company counsel that if Mr. Polsky’s termination
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