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Legal and Other Contingencies
3 Months Ended
Mar. 31, 2014
Legal and Other Contingencies  
Legal and Other Contingencies

3. Legal and Other Contingencies

 

The Company is subject to litigation in the normal course of its business. The Company applies the provisions as defined in the guidance related to accounting for contingencies in determining the recognition and measurement of expense recognition associated with legal claims against the Company. Management uses guidance from internal and external legal counsel on the potential outcome of litigation in determining the need to record liabilities for potential losses and the disclosure of pending legal claims.

 

Certain lease contracts acquired in the Central Merger (defined in Note 5. Acquisition) include provisions allocating to the Company responsibility for all structural repairs required on the property, including repairs arising as a result of ordinary wear and tear. The Company may incur costs for certain structural repair obligations during 2014 and future years, the Company is unable to estimate an amount or range of estimated liability for these repairs in any particular year or in the aggregate. As a result, the Company has not recognized a liability for these costs in the accompanying consolidated financial statements. Additionally, the applicable indemnity pursuant to the Agreement and Plan of Merger dated February 12, 2012, and further discussed in Note 5. Acquisition, may not cover all such obligations, and there will be timing differences between the Company’s payments to satisfy these obligations and the receipt of indemnification thereof, and some indemnification obligations may be satisfied through the surrender of shares of the Company’s common stock.