Incredimail 2014 Annual Report Download - page 66

On November 9, 2012, Globis Capital Partners, L.P., ("Globis Partners"), Globis Capital Advisors, L.L.C., ("Globis Advisors"), Globis
Overseas Fund, Ltd., ("Globis Overseas"), Globis Capital Management, L.P., (the "Investment Manager"), Globis Capital, L.L.C., ("GC"), and
Mr. Paul Packer ("Mr. Packer," and together with Globis Partners, Globis Advisors, Globis Overseas, the Investment Manager and GC, the
"Globis Reporting Persons") jointly filed a Schedule 13G relating to the beneficial ownership of a total of 535,617, or 5.3%, of our ordinary
shares. Globis Advisors serves as the general partner of Globis Partners. The Investment Manager serves as the investment manager to, and has
investment discretion over the securities held by, Globis Partners and Globis Overseas. GC serves as the general partner of the Investment
Manager. Mr. Packer is the Managing Member of Globis Advisors and GC. Each of Globis Partners and Globis Advisors reported beneficial
ownership of 465,097, or 4.6%, of our ordinary shares. Globis Overseas reported beneficial ownership of 70,520, or 0.7%, of our ordinary
shares. Each of the Investment Manager, GC and Mr. Packer reported beneficial ownership of 535,617, or 5.3%, of our ordinary shares. On
February 14, 2013, the Globis Reporting Persons jointly filed a Schedule 13G/A relating to the beneficial ownership of a total of 519,050, or
4.3%, of our ordinary shares and therefore reporting ceasing to be the beneficial owners of more than 5% of our outstanding shares.
On December 10, 2012, Holine Finance Ltd. filed a Schedule 13G reporting it had beneficial ownership of 1,109,732, or 9.2%, of our
ordinary shares. As a result of the ClientConnect Acquisition, Holine Finance's percentage ownership was diluted to less than 5% of our
outstanding ordinary shares.
To our knowledge, as of April 13, 2015, we had 24 shareholders of record of which 13 (including the Depository Trust Company) were
registered with addresses in the United States. These U.S. holders were, as of such date, the holders of record of approximately 99.5% of our
outstanding shares. The number of record holders in the United States is not representative of the number of beneficial holders nor is it
representative of where such beneficial holders are resident since many of these ordinary shares were held of record by brokers or other
nominees.
B. RELATED PARTY TRANSACTIONS
It is our policy that transactions with office holders or transactions in which an office holder has a personal interest will be on terms
that, on the whole, are no less favorable to us than could be obtained from independent parties.
See "Item 10.B Memorandum and Articles of Association — Approval of Related Party Transactions" for a discussion of the
requirements of Israeli law regarding special approvals for transactions involving directors, officers or controlling shareholders.
Agreements with Conduit
As a condition precedent to the closing of ClientConnect Acquisition on January 2, 2014, Conduit and ClientConnect effected the
Conduit Split and entered into the ancillary agreements described below. As a result of the ClientConnect Acquisition, two office holders of
Conduit – Dror Erez and Roy Gen –
became members of our Board of Directors and the major shareholders of Conduit also became major
shareholders of the Company. For information about additional agreements we entered into in connection with the ClientConnect Acquisition,
see Item 10.C "Additional Information—Material Contracts—
Agreements Relating to the ClientConnect Acquisition." Such directors and major
shareholders are parties to or otherwise bound by some of such agreements, as described therein.
Split Agreement
Pursuant to the Split Agreement, dated September 16, 2013, between Conduit and ClientConnect, on December 31, 2013, the entire
activities and operations, and related assets and liabilities, of the ClientConnect business were transferred by Conduit to ClientConnect on a
cash-free and debt-
free basis and the Conduit shareholders became the shareholders of ClientConnect in proportion to their ownership of Conduit
(the "Conduit Split"). The assets of Conduit were transferred on an "as is" basis for no consideration. Certain liabilities were retained by Conduit,
such as pre-
closing taxes and litigation matters. The parties agreed to indemnify each other with respect to any damages incurred by one party
with respect to liabilities of the other. During a transitional period, Conduit is entitled to use the transferred intellectual property and third party
intellectual property licenses (subject to their terms), create derivative works in respect thereof and integrate, sell and license such intellectual
property with Conduit’s retained business, subject to non-
competition provisions. In addition, during a transitional period, ClientConnect is
entitled to use domains and URL addresses that use the word "conduit" for new downloads or installs.
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