Incredimail 2012 Annual Report Download - page 305

9.5 Resolution of Objections to Claims .
(a) If the Shareholders’
Agent delivers such Objection Certificate within the Objection Period,
Purchaser and the Shareholders’ Agent shall attempt in good faith for 45 days after Purchaser’
s receipt of such Objection
Certificate to resolve such objection. If Purchaser and the Shareholders’
Agent shall so agree, a memorandum setting
forth such agreement shall be prepared and signed by both parties setting forth the approved portion of the Set-
off
Amount, if any, with respect to the claim and objection so resolved. For the avoidance of doubt, the resolution of a
contingent liability set forth in a Claim Certificate and related Objection Certificate (a " Contingent Claim
") may be
deferred by an agreement between Purchaser and the Shareholders' Agent to wait for the contingency to be finally
resolved.
(b) After the final resolution of any item specified in an Objection Certificate, Purchaser shall pay to
the Paying Agent (for distribution to the Company Securityholders pursuant to their respective Pro Rata Shares) the excess
of the Set-off Amount over the approved portion of the Set-off Amount, if any (the " Set-off Excess ") less
that portion of
the Set-
off Excess that is determined, in the reasonable judgment of Purchaser, to be necessary to satisfy all unsatisfied or
disputed claims for indemnification specified in any Claim Certificate delivered to Shareholders’
Agent prior to the end of
the applicable Set-off Period, if any. Any Set-
off Excess after the resolution of all such objections following the
applicable Set-
off Period shall be paid to the Paying Agent and distributed to the Company Securityholders in accordance
with their respective Pro Rata Shares.
(c) Should Purchaser and the Shareholders’
Agent be unable to agree as to any particular item or
items or amount or amounts specified in an Objection Certificate within the time period specified in Section 9.5(a), then
Purchaser shall be required to submit the matter to arbitration in accordance with this subsection (
c), within 20 Business
Days (the amount of indemnification sought in such arbitration, the " Disputed Amount
"), unless the amount of the
Indemnifiable Damages that is at issue is a Contingent Claim, in which event arbitration shall not be commenced but may
be requested by Purchaser only within 20 Business Days after such amount is finally ascertained or both parties agree in
writing to arbitration. In the event the matter is submitted to arbitration, it shall be settled by arbitration conducted in
English by one arbitrator mutually agreeable to Purchaser and the Shareholders’
Agent. In the event that, within 10
calendar days after submission of any dispute to arbitration as set forth above, Purchaser and the Shareholders’
Agent
cannot mutually agree on one arbitrator, then, within 15 calendar days after the end of such 10-
calendar day period,
Purchaser and the Shareholders’
Agent shall each select one nominee. The two nominees so selected shall select the
arbitrator, who shall have relevant experience, to conduct the arbitration. Any such arbitration shall be held in Tel Aviv,
Israel, under the Israel Arbitration Law, 5728-1968 (as amended, the “ Arbitration Law ”).
The arbitrator shall not be
bound by procedural law or rules of evidence, but will rule consistent with the substantive law of the State of Israel. The
arbitrator shall determine how all expenses relating to the arbitration shall be paid, including the respective expenses of
each party, the fees of the arbitrator and the administrative fees. The parties agree to use all reasonable efforts to cause the
arbitrator to set a limited time period and establish procedures designed to reduce the cost and time for discovery while
allowing the parties an opportunity, adequate in the sole judgment of the arbitrator, to discover relevant information from
the opposing parties about the subject matter of the dispute. The arbitrator shall rule upon motions to compel or limit
discovery and shall have the authority to impose sanctions, including attorneys' fees and costs, to the same extent as a
competent court of law or equity, should the arbitrator determine that discovery was sought without substantial
justification or that discovery was refused or objected to without substantial justification. The decision of the arbitrator as
to any particular item or items or amount or amounts specified in a Claim Certificate shall be final, binding, and
conclusive upon the Indemnifying Parties (as a single group, if applicable) and the Indemnified Person (the amounts so
determined, the “ Awarded Indemnifiable Damages ”).
Such decision with respect to the Awarded Indemnifiable
Damages shall be written and shall be supported by written findings of fact and conclusions of law which shall set forth
the award, judgment, decree or order awarded by the arbitrator(s). Any ruling or decision of the arbitrator may be
enforced in any court of competent jurisdiction. Either party shall be entitled to appeal to the District Court of Tel Aviv
any manifest error by the arbitrator in the application of applicable law in accordance with Section 29B of the Arbitration
Law. This section constitutes an Arbitration Agreement in accordance with the Arbitration Law. In the event of any
contradiction between the provisions hereof and the Arbitration Law, the provisions of this Agreement shall prevail.
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