Reproduction steps:
1) Open attached project
2) Open "offline" scene
3) Start scene
4) Press "LAN Host(H)" button
5) Compare behavior of both spheres

Expected result:
Red sphere (with Network Identity) should fall until distance between connected anchor and object is same as max distance's value.

Actual result:
Red sphere falls infinitely down ignoring "distance" value which has to set max distance from connected anchor.

Note:
Changing any value in component forces object to go to max distance position.