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will appoint the arbitrator based on the composite order of preference of the parties, or in the event <br /> of a tie, shall designate the arbitrator from those involved in the tie. <br /> The parties will be given notice by JAG of the appointment of the arbitrator,who shall be subject <br /> to disqualification for a)partiality or lack of independence, or b)inability or refusal to perform his <br /> or her duties with diligence and in good faith. Any objection by a party to the arbitrator shall be <br /> made within seven days of notice of selection of the arbitrator for cause and shall be confirmed in <br /> writing to JAG with a copy to the other party or parties. In the event the JAG is unable to appoint <br /> an arbitrator from the first list submitted following disqualifications for cause, JAG is empowered <br /> to appoint an arbitrator without the submission of additional lists. <br /> Any person appointed as an arbitrator shall have the continuing duty to disclose to JAG any <br /> circumstance likely to give rise to justifiable doubt as to the arbitrator's impartiality or <br /> independence,including any bias or any financial or personal interest in the result of the arbitration <br /> or any past or present relationship with the parties or their representatives. <br /> No party and no one acting on behalf of any party shall communicate ex parte with an arbitrator. <br /> (f) Preliminary Management Hearing. A preliminary telephone conference shall be held <br /> among the parties or their representatives and the arbitrator within 10 business days from the <br /> confirmation of the arbitrator's appointment (the "Preliminary Management Hearing"). Parties <br /> shall accept notice of all matters and hearings,including preliminary hearings,by telephone,email, <br /> or fax. During the Preliminary Management Hearing, the arbitrator shall direct the parties' <br /> preparations and presentations so that the arbitration hearing can be closed no later than 45 days <br /> after the date of the Preliminary Management Hearing. Arrangements made during the <br /> Preliminary Management Hearing shall be confirmed in writing to the parties. <br /> (g) Exchange of Information. At least seven business days prior to the arbitration hearing or <br /> no later than the date established by the arbitrator, the parties shall (a) exchange directly between <br /> themselves copies of all exhibits, affidavits and any other information they intend to submit at the <br /> hearing,and(b)identify all witnesses they intend to call at the hearing.The arbitrator is authorized <br /> to resolve any disputes concerning the exchange of information. There shall be no discovery. <br /> (h) Date, Time and Place of Hearing. The arbitrator shall set and notify the parties of the date, <br /> time, and place of the hearing. The hearing shall be set so that it shall close no later than 45 days <br /> after the date of the Preliminary Management Hearing. <br /> (i) Hearing. The hearing should not exceed one day.For good cause shown,the arbitrator may <br /> schedule additional time, which shall not a) exceed the equivalent of one day, and b) not extend <br /> the closing date of the hearing more than 60 days after the date of the Preliminary Management <br /> Hearing. The arbitrator may require witnesses to testify under oath. <br /> Augmentation Water Lease Agreement <br /> Page 10 of 11 <br />