UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
JETBORNE INTERNATIONAL, INC.
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(Name of Issuer)
Common Stock, par value $0.1 per share
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(Title of Class of Securities)
477144 20 8
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(CUSIP Number)
Steven J. Glusband
Carter, Ledyard & Milburn
2 Wall Street, New York, New York 10005
(212) 732-3200
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
August 18, 1997 and September 15, 1997
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
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The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
CUSIP No. 477144208
1 NAME OF REPORTING PERSON: RADA ELECTRONIC INDUSTRIES LIMITED.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY): None
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [ ]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS: OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e): [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Israel
NUMBER OF 7 SOLE VOTING POWER: 1,747,393 shares of Common Stock
SHARES
BENEFICIALLY 8 SHARED VOTING POWER: -0-
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER: 1,747,393 shares of Common Stock
REPORTING
PERSON WITH 10 SHARED DISPOSITIVE POWER: -0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON: 1,747,393 shares of Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 74.99%
14 TYPE OF REPORTING PERSON: CO
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This Statement is being filed to report two purchases by Rada Electronic
Industries Limited of (i) 1,141,630 shares of common stock of Jetborne
International, Inc. on August 18, 1997, and (ii) 605,763 shares of common stock
of Jetborne International, Inc. from Bodstray Company Ltd. ("Bodstray"), a Hong
Kong corporation and the then principal shareholder of Jetborne International,
Inc., on September 15, 1997. Both share purchases were made in private
transactions and the number of shares reflected a one (1) for ten (10) reverse
stock split effective September 30, 1997.
Item 1. Security and Issuer.
The class of equity securities to which this Statement relates is the class
of shares of common stock, par value $0.1 per share of Jetborne International,
Inc., reflecting a one (1) for ten (10) reverse stock split effective September
30, 1997 (the "Common Stock").
The issuer of the Common Stock is Jetborne International, Inc. (the
"Issuer"), a Delaware corporation, whose principal executive offices are located
at 4010 Northwest 36th Avenue, Miami, Florida 33142.
Item 2. Identity and Background.
This Statement is being filed by Rada Electronic Industries limited, an
Israeli corporation ("Rada"). Rada's principal business is (i) the development,
manufacture, marketing and sale of aerospace, naval and ground electronic
equipment both for commercial and military use; and (ii) the distribution and
sale of electronic components, personal computers and aircraft parts. Rada has
subsidiaries in Israel and the United States.
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The address of the principal offices of Rada, and the business address of
its executive officers listed below, is 12 Medinat Hayehudim Street, Hertzliya
Pituach 46120, Israel.
The following is information concerning each executive officer and director
of Rada:
1. Name: Yair Grinberg
Position with Rada: Chairman of the Board
Present Principal Occupation: Same
Residence Address: 3 Kashani Street, Ramat Aviv, Israel
Citizenship: Israeli
2. Name: Haim Nissenson
Position with Rada: President and Chief Executive Officer
Present Principal Occupation: Same
Residence Address: 11 Yehuda Maccabi Street, Hertzliya, Israel
Citizenship: Israeli
3. Name: Herzel Bodinger
Position with Rada: President, Rada Electronic Industries, Inc.
Present Principal Occupation: Same. Rada Electronic Industries, Inc. is
a wholly owned subsidiary of Rada
incorporated in Delaware and engaged in
international marketing activities, whose
principal business address is 80 Express
Street, Plainview, NY 11803.
Residence Address: 31 Aya Street, Ramat Hasharon, Israel 47226
Citizenship: Israeli
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4. Name: Meir Hermel
Position with Rada: Chief Financial Officer
Present Principal Occupation: Same
Residence Address: 65 Hailanot Street, Hertzliya, Israel
Citizenship: Israeli
5. Name: Meir Shariv
Position with Rada: Marketing Coordinator and Director
Present Principal Occupation: Same
Residence Address: 10 Bar-Ilan Street, Holon, Israel 58447
Citizenship: Israeli
6. Name: Hadas Barnoy Tsror
Position with Rada: Corporate Secretary and Legal Advisor
Present Principal Occupation: Same
Residence Address: 26 Sharet Street, Tel Aviv, Israel 62092
Citizenship: Israeli
7. Name: Itzhak Almog
Position with Rada: Director
Present Principal Occupation: Chief Executive Officer of Powercom
Control Ltd., an Israeli company engaged
in the development and sale of communi-
cations and control software for the
International energy market, whose prin-
cipal business address is 11 Ben Gurion
Street, Givat Shmuel, Israel 54017.
Residence Address: 7/A Moledet Street, Hod Hasharon, Israel 45341
Citizenship: Israeli
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<PAGE>
8. Name: Adrian Berg
Position with Rada: Director
Present Principal Occupation: Chartered Accountant and Senior Partner at
Alexander & Co., a U.K. Chartered
Accountants firm, whose principal business
Address is 17 St. Ann's Square,
Manchester, England, M2 7PW, U.K.
Residence Address: 26 Cherington Road, Cheadle Cheshire, England, SK81LN,
U.K.
Citizenship: British
9. Name: Eles Dobronsky
Position with Rada: Director
Present Principal Occupations: Advocate and Senior Partner at the Israeli
law firm, Dobronsky and Giora, whose prin-
cipal business address is 68 Iben Gabirol
Street, Tel Aviv, Israel; Chairman of the
Board, acting Chief Executive Officer and
Chief Financial Officer of the Issuer
(see above).
Residence Address: 44 Rav Fridman Street, Tel Aviv, Israel
Citizenship: Israeli
10. Name: Eitan Gurel
Position with Rada: Director
Present Principal Occupation: Independent Economic and Financial
Consultant, whose principal business
address is 63 Iben Gabirol Street,
Tel Aviv, Israel.
Residence Address: 55 Dan Street, Kochav Yair, Israel
Citizenship: Israeli
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11. Name: David Kenig
Position with Rada: Director
Present Principal Occupation: Independent Consultant and Software
Developer; Chief Executive Officer of
Crossnet, Inc., a U.S. corporation
engaged in computers' communication and
software development, whose principal
business address is 576 5th Avenue, Suite
1103, New York, New York 10036.
Residence Address: 33 Shazar Street, Hertzliya Pituach, Israel
Citizenship: Israeli
12. Name: Shai Kuttner
Position with Rada: Director
Present Principal Occupation: Lawyer and Managing Partner in the Dutch
law firm, Brada, Kuttner and Gazit,
Advocates, whose principal business
address is Koningslaan 14 1075 AC
Amsterdam, the Netherlands; and Partner
in the Israeli branch of the firm, whose
principal business address is 1 David
Ha'Melech Street, Tel Aviv, Israel.
Residence Address: 4/A Har Nevo Street, Ramat Hasharon, Israel 47225
Citizenship: Israeli
13. Name: Israel Singer
Position with Rada: Director
Present Principal Occupation: Principal of the Blich High School, located
in 22 Givati Street, Ramat Gan, Israel.
Residence Address: 63 Ben-Eliezer Street, Ramat Gan, Israel
Citizenship: Israeli
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<PAGE>
During the past five years, none of Rada, or (to the best knowledge of
Rada) any of the persons listed above has been (i) convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors), or (ii) a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction, as a result of such proceeding it, he or she was or is subject to
a judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, United States federal or state, or Israeli,
securities laws, or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
On August 18, 1997, Rada entered into a Capital Stock for Inventory
Purchase Agreement with the Issuer (the "Stock-Inventory Agreement"), pursuant
to which Rada acquired 1,141,630 shares of Common Stock of the Issuer. The
1,141,630 shares of Common Stock, representing 49% of the Issuer's issued and
outstanding shares of Common Stock, were acquired in consideration of the full
satisfaction of an outstanding debt of approximately $2.7 million due to Rada's
wholly owned subsidiary, Adar Active Technologies B.V. ("Adar"). The debt arose
from the Issuer's purchase of certain aircraft parts inventory (the "Inventory")
from Adar in December 1996. The Inventory was held by Adar since 1996 and its
purchase was funded from its working capital. The basis of the calculation
utilized for the purpose of acquiring the 49% interest was the book value of the
Issuer, for which Rada obtained an independent evaluation, and an appraisal of
the Inventory. The Stock-Inventory Agreement provided that 1,141,630 shares of
Common Stock would be issued to Rada within 180 days from the execution date of
the Stock-Inventory Agreement and was conditioned upon the full satisfaction or
waiver of certain
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conditions. On October 1, 1997, the Issuer issued the 1,141,630 shares of Common
Stock to Rada. The Stock-Inventory Agreement is being filed herewith as Exhibit
1 to this Statement and is incorporated herein by reference.
On September 15, 1997, Rada entered into a Capital Stock Purchase and Sale
Agreement (the "Exchange Agreement") with Bodstray, the then principal
shareholder of the Issuer, whereby Rada acquired 605,763 shares of Common Stock,
representing 26% of the Issuer's issued and outstanding shares of Common Stock,
in exchange for 700,000 Ordinary Shares, par value NIS .002 per share of Rada
(the "Ordinary Shares"), representing approximately 5.3% of the issued and
outstanding Ordinary Shares of Rada.
On September 30, 1997, Bodstray transferred the 605,763 shares of Common
Stock to Rada. To date, Rada has not yet issued the 700,000 Ordinary Shares to
Bodstray and it is anticipated that such issuance will take place by the end of
November 1997. The Stock Exchange Agreement is being filed herewith as Exhibit 2
to this Statement and is incorporated herein by reference.
As a result of the two foregoing transactions, Rada owns approximately 75%
of the Issuer's issued and outstanding shares of Common Stock with the public
holding the remaining approximately 25%.
Item 4. Purpose of Transaction.
The first purchase of 1,141,630 shares of Common Stock from the Issuer was
made by Rada in order to settle the outstanding debt of $2.7 million of the
Issuer, while the second purchase of 605,763 shares of Common Stock from
Bodstray was made for the purpose of
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<PAGE>
acquiring a controlling interest in the Issuer. As part of its business
strategy, Rada has begun to focus on providing testing services for the
commercial aviation industry via the establishment of maintenance centers. Such
maintenance centers will utilize Rada's CATS tester which is capable of
verifying within a short period of time whether a computer and avionic component
removed from an aircraft is serviceable or requires repair. Rada opened its
first maintenance center at Beijing International Airport in China in 1997 and
is scheduled to open two additional maintenance centers at Miami and Los Angeles
International Airports in the fourth quarter of 1997 and the third quarter of
1998, respectively. The establishment and operation of the maintenance centers
in the United States will be conducted through a joint venture company, New Reef
Holdings Ltd., in which Rada currently holds a 25% interest.
Because of synergies between maintenance operations and the distribution
and sale of spare parts, the management of Rada decided to renew its involvement
in the commercial aviation spare parts business through the purchase of a
controlling interest in the Issuer, which is an aircraft spare parts provider
based in Miami, Florida. Rada's management believes that the controlling
interest in the Issuer will enable Rada to combine its testing and repair
capabilities, which will be provided by the maintenance centers in the United
States, with the supply and replacement of avionics and other spare parts
activities of the Issuer.
Pursuant to the Stock-Inventory Agreement, Rada and the Issuer agreed to
negotiate, following the consummation of the purchase of the 1,141,630 shares of
Common Stock, an agreement pertaining to the participation of Rada in the
management of the Issuer. Rada intends to appoint three (3) persons to serve on
the Board of Directors of the Issuer. Mr. Eles Dobronsky, a director of Rada,
has served as the appointee of a former group of shareholders of
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the Issuer as Chairman of the Board since May 1991. Mr. Dobronsky has served as
acting Chief Executive Officer and Chief Financial Officer of the Issuer since
March 1997. It is anticipated that Mr. Dobronsky will continue to serve as a
director of the Issuer and that the Issuer will appoint other persons to serve
as Chairman, Chief Executive Officer and Chief Financial Officer. The Board of
Directors of the Issuer currently consists of five (5) directors.
Effective September 30, 1997, the Issuer completed a one (1) for ten (10)
reverse stock split. Immediately after the reverse stock split, the Issuer had
authorized capital of 14,000,000 shares of Common Stock with 1,188,228 shares of
Common Stock issued and outstanding. Subsequent to the issuance of 1,141,630
shares of Common Stock to Rada on October 1, 1997, the Issuer had 2,329,858
issued and outstanding shares of Common Stock.
Apart from the foregoing, none of Rada, or (to the best knowledge of Rada)
any person named in Item 2 of this Statement (in his or her capacity as a
director or executive officer of Rada) has any plans or proposals which relates
to or would result in: (a) the acquisition by any person of additional
securities of the Issuer, or the disposition of securities of the Issuer; (b) an
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Issuer or any of its subsidiaries; (c) a sale or
transfer of a material amount of assets of the Issuer or any of its
subsidiaries; (e) any material change in the present capitalization or dividend
policy of the Issuer; (f) any other material change in the Issuer's business or
corporate structure; (g) any changes in the Issuer's Certificate of
Incorporation or Bylaws or other actions which may impede the acquisition of
control of the Issuer by any person; (h) causing a class of securities of the
Issuer to be delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a registered
national securities association; (i) a class of
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equity securities of the Issuer becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934; or (j) any action similar to any of the foregoing.
Item 5. Interest in Securities of the Issuer.
(a) and (b) Rada is the beneficial owner of 1,747,393 shares of Common
Stock representing approximately 75% of the currently outstanding and issued
shares of Common Stock. Rada has the sole power to vote or direct the vote and
sole power to dispose or direct the disposition of all such 1,747,393 shares of
Common Stock.
To the best knowledge of Rada, none of its directors or executive officers
is the beneficial owner of any interest in the Issuer, except that on December
20, 1996, the Board of Directors of the Issuer approved the issuance to Eles
Dobronsky of warrants (the "Warrants") to purchase up to 285,174 shares of
Common Stock, representing 24% of the then issued and outstanding shares of
Common Stock of the Issuer. The warrants were granted in connection with Mr.
Dobronsky's services as Chairman of the Board of the Issuer since May 1991.
The Warrants are exercisable at $0.842 per share for a period of five (5)
years beginning July 1, 1996 and will expire on June 30, 2001. None of the
Warrants have been exercised to date.
(c) Apart from the acquisitions of 1,141,630 shares of Common Stock from
the Issuer on August 18, 1997 and of 605,763 shares of Common Stock from
Bodstray on September 15, 1997 in private transactions, and the acquisition by
Eles Dobronsky of the Warrants as noted in Item 5 (a) and (b) above, none of
Rada, or (to the best knowledge of Rada) any of its directors and executive
officers listed in Item 2 of this Statement has effected any transactions in the
shares of Common Stock of the Issuer during the past sixty days.
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<PAGE>
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to
Securities of the Issuer.
None.
Item 7. Material to be Filed as Exhibits.
Exhibit 1: Capital Stock for Inventory Purchase Agreement
dated August 18, 1997 between Rada Electronic
Industries Limited and Jetborne International, Inc.
Exhibit 2: Capital Stock Purchase and Sale Agreement dated
September 15, 1997 between Bodstray Company Ltd. and
Rada Electronic Industries Limited.
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<PAGE>
SIGNATURE
After reasonable inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this Statement is true,
complete and correct.
Date: October 27, 1997
RADA ELECTRONIC INDUSTRIES LIMITED
By: /s/Haim Nissenson
------------------
Haim Nissenson
President and Chief Executive Officer
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<PAGE>
EXHIBIT INDEX
Exhibit 1: Capital Stock for Inventory Purchase Agreement
dated August 18, 1997 between Rada Electronic
Industries Limited and Jetborne International, Inc.
Exhibit 2: Capital Stock Purchase and Sale Agreement dated
September 15, 1997 between Bodstray Company Ltd. and
Rada Electronic Industries Limited.
Exhibit 1
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CAPITAL STOCK FOR INVENTORY PURCHASE AGREEMENT
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THIS CAPITAL STOCK FOR INVENTORY PURCHASE AGREEMENT ("Agreement") is made
this 18th day of August, 1997 by, between and among RADA Electronic Industries,
Ltd. (hereinafter referred to as "RADA" or "Seller") and Jetborne International,
Inc. (hereinafter referred to as "JII", "Company" or "Buyer"), for the purchase
of aircraft parts inventory in exchange for restricted capital stock of the
Seller.
W I T N E S S E T H :
WHEREAS, Jetborne International, Inc. purchased certain aircraft parts
inventory from RADA during December, 1996; and
WHEREAS, RADA's invoice for such aircraft parts inventory has been
outstanding and unpaid by the Company; and
WHEREAS, the parties have determined to satisfy the unpaid aircraft parts
inventory invoice obligation through RADA's acquisition of an ownership interest
in the Company; and
WHEREAS, Jetborne International, Inc., a publicly held Delaware corporation
("JII") has authorized capital stock comprised only of 14,000,000 shares of $.01
par value Common Stock, of which 11,882,286 shares are issued and outstanding as
of the date of this Capital Stock Purchase Agreement (the "Agreement"); and
WHEREAS, Jetborne International, Inc. intends to reverse split its Common
Stock on a one (1) post-split share for ten (10) pre-split shares basis; and
WHEREAS, the parties agree that the unpaid obligation is equivalent in
value to approximately forty-nine (49%) percent of the ownership interest in
JII; and
WHEREAS, the Seller is agreeable to issuing, selling, transferring and
conveying approximately forty-nine (49%) percent of its ownership interest to
the Seller to extinguish the unpaid obligation generated by its purchase of the
certain inventory,
NOW THEREFORE, in consideration of the premises and respective
representations, warranties, covenants, agreements and indemnities contained in
this Agreement, each of the parties hereto hereby agrees as follows:
ARTICLE I.
RECITALS
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The parties confirm that each of the foregoing recitations are true and
correct in all respects and are incorporated herein.
<PAGE>
ARTICLE II.
PURCHASE AND SALE
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The Buyer shall issue, from authorized, previously unissued Common Stock,
and shall sell, assign, transfer and convey to the Seller, 1,141,630
(post-split) shares of the restricted Common Stock of Jetborne International,
Inc. (the "Shares").
ARTICLE III.
CLOSING
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Consummation of the transaction contemplated herein shall occur upon
delivery to the Seller of the post-split JII Shares as contemplated herein and
shall constitute the Closing which shall take place within one hundred eighty
(180) days of full and final execution of this Agreement. Whenever reference is
made in this Agreement to a state of facts in existence on the Closing Date,
such reference shall be taken to refer to the close of the business on the day
immediately preceding the Closing Date.
ARTICLE IV.
CONSIDERATION; SUBSEQUENT MANAGEMENT
------------------------------------
In exchange for the Shares, the Seller shall withdraw its invoice to JII
for the said certain lot of aircraft parts inventory and cancel and extinguish
its receivable therefor in the amount of approximately $2,700,000 (U.S.).
The parties intend to negotiate a subsequent agreement regarding
participation of the Seller in management of the Company following execution of
this Agreement and consumation of the transactions contemplated herein.
ARTICLE V.
REPRESENTATIONS & WARRANTIES OF THE BUYER
-----------------------------------------
5.1 Except as disclosed in the schedules attached hereto, as a material
inducement to the Seller to execute and perform its obligations under this
Agreement, the Buyer represents and warrants to the Seller, as of the date
hereof, and as of the Closing Date, as follows:
A. Organization and Good Standing - Compliance. JII is duly organized,
validly existing and in good standing under the laws of the State of
Delaware with full power and authority to own or lease and operate its
properties and assets and to carry on any business. JII is presently
engaged in commercial operations with assets and liabilities as
reflected in its most recent draft annual reports on Form 10-K not yet
filed with the U.S. Securities & Exchange Commission for the fiscal
years ended April 30, 1996 and 1997. Seller acknowledges prior receipt
of a true copy of such draft annual reports. The Company has all
requisite corporate power to enter into this Agreement and to sell the
Shares and to carry out and perform its obligations under the terms of
this
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Agreement.
B. Capital Stock. JII has only one class of capital stock, i.e. Common
Stock, $.01 par value per share, of which there are 14,000,000 shares
authorized, 11,882,280 shares issued and outstanding as of the date of
this Agreement. Upon consummation of the transaction contemplated
hereby, all issued and outstanding shares of capital stock of JII will
have been duly authorized and validly issued, fully paid and
non-assessable. Upon completion of the one (1) for ten (10) reverse
split planned, JII will have 14,000,000 shares and 1,188,228
(post-split) shares issued and outstanding.
C. Liens And Encumbrances. There are no liens, encumbrances, pledges,
probational agreements or claims of any nature against the JII Shares
(to be issued to the Seller by the Buyer).
D. Securities Law and Warrants and Options.
(a) All of the outstanding Common Stock of JII was offered and sold
in accordance with applicable federal and state securities laws
or applicable exceptions thereunder and there are no preemptive
rights in respect thereof.
(b) Except for options for 285,174 (post-split) shares issued to Eles
Dobronsky during December, 1996 which options are issued and
outstanding at date, there are no outstanding rights, options,
warrants, rights, calls, puts, commitments, plans or other
agreements of any nature or character providing for the purchase
or issuance of any other authorized, unissued shares of the
Common Stock of JII.
E. Financial Statements. The Buyer has delivered or caused to be
delivered to the Seller copies of its financial statements, balance
sheets, income statements and last U.S. tax return.
F. Financial Position. The (unaudited) balance sheets of JII as at April
30, 1997, (hereinafter called the "Balance Sheet Date") and the
related statements of income and changes in financial positions for
each of the fiscal periods then ended, in the form contained in the
JII draft Annual Report on Form 10-K, are correct and complete in all
material respects and present fairly the financial position of JII at
the respective dates thereof, and changes in its financial position
for each of the respective fiscal periods then ended, all in
conformity with generally accepted accounting principles applied on a
consistent basis with prior fiscal periods. The (unaudited) statement
of financial position of the Company as at the Balance Sheet Date may
hereafter be called the "April, 1997 Balance Sheet".
G. Liabilities and Taxes. As at the Balance Sheet Date, JII had no
liabilities or obligations, absolute, accrued, contingent or
otherwise, which have not been reflected
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in the (unaudited) April, 1997 Balance Sheet or otherwise disclosed to
the Buyer. The JII April 30, 1997 Balance Sheet (unaudited) includes
adequate provision, in accordance with generally accepted accounting
principles, for:
i. all taxes, federal, state and local, payable by JII; and
ii. all other liabilities of the Company including, without limiting
the generality of the foregoing, all accounts payable, accrued
expenses, sundry payables and current and future installments on
indebtedness payable, if applicable.
H. No Material Change. Since the Balance Sheet Date, there has been:
i. no material change in the assets or liabilities or the condition,
financial or otherwise of JII, whether or not arising from
transactions in the ordinary course of business; and
ii. no payment, agreement or promise by JII out of the normal course
of its business to pay any wages, salaries, compensation or
remuneration of any kind;
iii. no disbursement or agreement to make a disbursement of any kind
out of the normal course of its business;
iv. no payment or declaration by JII of any unpaid dividend or
distribution on, or purchase, redemption or other acquisition by
JII of, any shares of stock or other securities issued by JII;
v. no changes in the inventories reflected in the unaudited
financial statements of the Company which are readily
merchantable, containing no material amount of slow moving,
obsolete or damaged goods which have not been written down in
conformity with generally accepted accounting principles applied
on a basis consistent with prior periods; and
vi. no change in the trade receivables reflected in the unaudited
financial statements of the Company which are, except to the
extent heretofore collected, fully collectible and subject to no
counterclaims or set-offs. Since the Balance Sheet Date, except
as reflected therein, the Company has not issued any securities
or incurred any liability or obligation, direct or contingent,
for borrowed money, except such liabilities or obligations
incurred in the ordinary course of business.
Since the Balance Sheet Date, there has been no material change in the
business or operations of JII and since the Balance Sheet Date, its
properties and assets have not been materially adversely affected in
any way as a result of any occurrence, including,
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without limitation, fire, explosion, earthquake, flood, windstorm,
accident or any other casualty, labor trouble, condemnation,
requisition or taking by any government or any agency of any
government, embargo, riot, act of god or other similar or dissimilar
casualty or event.
I. Contracts, Obligations. Except as reflected in the draft JII Annual
Reports on Form 10-K for the years ended April 30, 1996 and 1997, JII
is neither party to nor bound or affected by any:
i. executory contracts for the purchase, sale or lease of assets;
ii. management, employment, agency or consulting contracts;
iii. collective bargaining agreements or other contracts with labor
unions;
iv. bonus, profit-sharing, pension, employee benefit, retirement or
deferred compensation plans or arrangements;
v. outstanding options or warrants, other than the Dobronsky options
reflected in paragraph 5.1, D., for the purchase of its common
stock or of any other security;
vi. contracts with any distributor, dealer or sales representative;
vii. note agreements, loan agreements, indentures or other
instruments; and
viii instruments evidencing liens or secured transactions.
Each contract, lease, agreement, covenant, license, instrument or
commitment, if any, described in such draft Forms 10-K is valid, in
full force and effect and enforceable in accordance with its terms.
J. Tax Returns, Required Filings. JII has filed with appropriate
governmental agencies all reports, applications, instruments and other
documents required by applicable federal or state securities laws and
all tax returns required to be filed with such agencies and is not
delinquent with respect to any such filing and all such filings have
been true, correct and complete. JII has paid all taxes which have or
may become due pursuant to such returns and all assessments, fees and
charges claimed to be due by all federal, state, local and other
taxing authorities and any such payments are reflected on the
(unaudited) April 30, 1997 Balance Sheet or the (unaudited) financial
statements attached thereto. The federal income tax liability of JII
has been paid in full and there are no outstanding agreements, waivers
or other arrangements extending the statutory period of limitation
applicable to any tax return or report by, or the payment of taxes,
charges or deficiencies by the Company. JII has no
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<PAGE>
knowledge, notice or reason to know that any federal, state or local
taxing authority has asserted or may assert any claim or deficiency
for non-payment of any income, franchise, sales, property or other
taxes of any nature.
K. Performance of Obligations. JII, in all material respects has
performed, or is now performing, all obligations required to be
performed by it, nor is there any event which with the passage of
time, notice or either of them would constitute a default in any
respect under any material contract, license, lease, instrument or
commitment by which JII is bound or to which it is a party. Neither
JII nor any of its officers or directors has received any notice,
whether or writing or not, of any default, claim, investigation or
dispute affecting JII.
L. Investigations; Litigation. There is no inquiry, litigation, action,
investigation, claim, suit, dispute or proceeding pending or
threatened against or affecting JII, or any officer or director of
JII, at law or in equity, before any federal, state, municipal or
other authority or body, relating to JII or its securities, to the JII
shares, to this Agreement, or to the transactions contemplated by this
Agreement. Neither JII nor any officer or director of JII is in
default with respect to any order, writ, injunction or decree of any
court or federal, state, municipal or other governmental authority,
relating to JII or its securities, to the Shares, to this Agreement,
or to the transactions contemplated herein. JII represents and
warrants that there are no actions, suits, proceedings, complaints,
claims or governmental investigations pending, or to the best of its
knowledge, threatened, against or effecting the Company. There are no
outstanding orders, decrees or stipulations issued by local, state or
federal authority in any proceeding related to JII or in which JII is
or was a party. JII represents that the Company is not current with
respect to all filings with all governmental authorities. See
sub-paragraph 5.1, M., below.
M. Compliance with Applicable Law. Other than its continuing three year
delinquency in the filing of periodic reporting (Forms 10-Q and 10-K)
under the Securities & Exchange Act of 1934, JII has complied with all
laws, regulations and orders applicable to its conduct including,
without limiting the generality of the foregoing, any zoning
ordinances, federal and state securities laws, the federal
Occupational Safety And Health Act or the federal Employee Retirement
Income Security Act and all federal and state environmental laws and
has not received any written or oral notification to the contrary.
N. No Breach of Obligation. Neither the execution of this Agreement by
its officers thereunto duly authorized, or by JII, nor the performance
of the obligations of any of them hereunder, nor any action of JII
contemplated by this Agreement, conflicts with, constitutes grounds
for termination of, or constitutes a default under, any promissory
note, indenture, agreement, contract, license, lease, instrument or
commitment to which JII is a party or to which it is or may be bound,
or conflicts with the company's Certificate of Incorporation or its
By-Laws.
6
<PAGE>
O. Full Disclosure. All information contained in the materials furnished
to the Buyer pursuant to this Agreement by JII is, and shall be at the
Closing, correct and complete in all material respects. Such
information, and any other information, representations and warranties
given to the Buyer by JII or contained in any draft filing with the
U.S. Securities & Exchange Commission or any state securities
authorities, delivered to the Buyer by JII do not make any untrue
statement of material fact or omit to state any material fact required
to be stated therein or necessary to make the statements contained
therein, in light of the circumstances under which such statements are
made, correct, complete and not misleading. All information relating
to JII which is known or would on reasonable inquiry be known to its
officers and directors and which may be material to an intending
purchaser for value of capital stock of JII has been disclosed to the
Seller and any such information arising prior to the Closing Date will
forthwith be disclosed to the Seller. All underlying documents
incorporated or referred to herein or in documents furnished to the
Seller pursuant to this Agreement by JII are true and correct copies
thereof, as the same have been or shall be amended or modified. No
fraud, waste or other violations of, or non-compliance with, law or
the duties of JII, or its officers and directors, has been committed
in connection with the acquisition, disposition, write- down or
valuation of the Company's assets or in connection with its purchase
of the parts inventory hereunder.
P. Certain Transactions. There are no present contracts, leases,
agreements, covenants, licenses or commitments, written or oral,
between JII and any JII shareholder, director, officer or affiliate of
JII which is not reflected in its draft Annual Reports on Form 10-K
for the years ended April 30, 1996 and 1997.
Q. Binding Agreement. This Agreement constitutes a valid and binding
obligation of JII, enforceable in accordance with its terms.
R. Survival. Each of the representations and warranties set forth in this
Article V shall survive the Closing and shall be deemed renewed and
made again at the Closing as if made as at such time, except to the
extent of changes contemplated by this Agreement.
S. Conditions Precedent to Buyer's Obligations. Unless, at the Closing,
each of the following conditions is either satisfied or waived by the
Buyer in writing, the Buyer shall not be obligated to effect the
transactions under this Agreement:
i. The representations and warranties of Seller set forth in Section
6.1. hereof are true, correct, complete and not misleading at the
date of this Agreement and will be true, correct, complete and
not misleading as of the Closing as if each were again made at
such time.
ii. No claim, investigation, proceeding or litigation, either
administrative or judicial, shall be threatened or pending
against JII or RADA for the purpose
7
<PAGE>
of enjoining or preventing the consummation of this Agreement or
otherwise claiming that this Agreement, or the consummation
thereof, is improper, or that might materially or adversely
affect the business of JII or the right of the Seller to acquire
and retain the Shares or to conduct, following such acquisition,
the business of JII.
iii. All legal matters in connection with this Agreement and the
transactions contemplated herein, shall be in form and substance,
and all legal proceedings and of all papers and documents used or
delivered hereunder, shall be reasonably satisfactory to Eugene
Michael Kennedy, P.A., counsel for the Buyer.
iv. Any and all consents, approvals and authorizations that may be
required for the execution and delivery of this Agreement and
consummation of the transactions contemplated herein shall have
been obtained in form and substance satisfactory to the Buyer.
T. Legal Opinion. At the Closing, the Company will deliver to Seller an
opinion of counsel from Eugene Michael Kennedy, P.A. addressed to the
Buyer dated the Closing Date, substantially to the effect of sections
5.1, A., B., C., D.(b), I., K., L., M., N., O., P., Q., R. and S.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES OF SELLER
----------------------------------------
6.1 Except as disclosed in the schedules attached hereto, as a material
inducement to the Buyer to execute and perform its respective obligations under
this Agreement, the Seller represents and warrants to the Buyer as of the date
hereof and as of the Closing Date as follows:
A. Organization and Good Standing - Compliance. RADA is duly organized,
validly existing and in good standing under the laws of Israel with
full power and authority to own or lease and operate its properties
and assets and to carry on any business as it is now being conducted,
and is qualified to do business in every jurisdiction where the
failure to so qualify would have a material adverse effect on the
business of RADA or its properties. The Seller has full right, power
and authority to enter into this Agreement and to perform their
respective obligations as provided herein. The execution, delivery and
performance of this Agreement does not violate or conflict with any
applicable law.
B. Liens And Encumbrances. There are no liens, encumbrances, pledges,
probational agreements or claims of any nature against the parts
inventory to be transferred to the Seller by the Buyer. RADA is the
sole and absolute owner of the inventory transferred hereunder and has
full power and authority to complete the transactions
8
<PAGE>
contemplated herein.
C. Full Disclosure. All information contained in the materials attached
to this Agreement and in the documents furnished to the Buyer pursuant
to this Agreement by RADA is, and shall be at the Closing, correct and
complete in all material respects. Such information, and any other
information, representations and warranties given to the Buyer by
Seller, do not make any untrue statement of material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements contained therein, in light of the circumstances
under which such statements are made, correct, complete and not
misleading. All underlying documents incorporated or referred to
herein or in documents furnished to the Buyer pursuant to this
Agreement by the Seller are true and correct copies thereof, as the
same have been or shall be amended or modified.
D. Survival. Each of the representations and warranties set forth in this
Article VI shall survive the Closing and shall be deemed renewed and
made again at the Closing as if made as at such time, except to the
extent of changes contemplated by this Agreement.
E. Conditions Precedent to Seller's Obligations. Unless, at the Closing,
each of the following conditions is either satisfied or waived by the
Seller in writing, the Seller shall not be obligated to purchase the
Shares and shall not otherwise be obligated to effect the transactions
under this Agreement:
i. The representations and warranties of the Buyer set forth in
Section 5.1. hereof are true, correct, complete and not
misleading at the date of this Agreement and will be true,
correct, complete and not misleading as of the Closing as if each
were again made at such time.
ii. JII shall have complied with and performed each and every
covenant set forth in this Agreement to be performed by JII prior
to or at the Closing.
iii. No claim, investigation, proceeding or litigation, either
administrative or judicial, shall be threatened or pending
against JII or the Shares for the purpose of enjoining or
preventing the consummation of this Agreement or otherwise
claiming that this Agreement, or the consummation thereof, is
improper, or that might materially or adversely affect JII or the
right of JII to transfer the Shares.
iv. There shall be furnished to the Seller prior to or at the Closing
a certificate dated as of the Closing Date signed by JII to the
effect that all of the conditions set forth in this Article VI.
have been satisfied.
9
<PAGE>
v. All legal matters in connection with this Agreement and the
transactions contemplated herein, shall be in form and substance,
and all legal proceedings, and of all papers and documents used
or delivered hereunder, shall be reasonably satisfactory to Hadas
Barnoy, Esq., counsel for the Seller.
vii. Any and all consents, approvals and authorizations that may be
required for the execution and delivery of this Agreement and
consummation of the transactions contemplated herein shall have
been obtained in form and substance satisfactory to the Seller.
ARTICLE VII.
MUTUAL HOLD HARMLESS AND INDEMNIFICATION
----------------------------------------
A. By Seller. The Seller agrees to defend, indemnify, and hold Buyer
harmless from and against any loss, claim, damage, liability or
expense (including reasonable attorneys fees):
i. incurred or sustained by the Buyer on account of any and all
liabilities of Seller,
ii. incurred or sustained by the Buyer on account of any
misrepresentation or breach of any representation, warranty,
covenant, or agreement of the Seller contained in this Agreement
or in any schedule, exhibit, or other document delivered pursuant
hereto, or
iii. incurred or sustained by the Buyer on account of any liability of
the Seller for a finder's fee, brokerage commission, or other
like payment. If any claim is asserted against the Buyer for
which indemnification may be sought under the provisions of this
Article VII, the Buyer shall promptly notify the Seller that the
Seller may participate in the negotiation and settlement of any
such claim at the Seller's expense and permitting the Seller to
join in the defense of any legal action arising therefrom at the
Seller's expense. The Seller shall not be liable to the Buyer
under this Article VII for losses aggregating less than $1,000.00
(U.S.) or for losses with respect to any claim for which the
Buyer shall have failed to notice the Seller in writing within
eighteen (18) months from the Closing Date.
B. By Buyer. The Buyer agrees to defend, indemnify and hold the
Seller harmless from and against any loss, claim, damage,
liability or expense (including reasonable attorneys fees):
i. incurred or sustained by Seller on account of liabilities
and obligations arising out of or attributable to the
operation of the Business after the Closing date, or
accruing after the Closing Date under the contracts,
10
<PAGE>
lease or understandings assigned to the Seller,
ii. incurred or sustained by the Seller on account of any
misrepresentation or breach of any representation, warranty,
covenant, or obligation of the Buyer contained in this
Agreement or in any schedule, exhibit, or other document
delivered pursuant hereto, or
iii. incurred or sustained by the Seller on account of any
liability of the Buyer for a finder's fee, brokerage
commission, or other like payment. If any claim is asserted
against Seller from which indemnification may be sought
under the provisions of this Article VII, the Seller shall
promptly notify the Buyer of such claim and thereafter shall
permit the Buyer at the Buyer's expense to participate in
the negotiation and settlement of any such claim and to join
in the defense of any legal action arising therefrom. The
Buyer shall not be liable to Seller under this Article VII
for losses aggregating less than $1,000.00 (U.S.) or for
losses with respect to which the Seller shall not have given
the Buyer notice in writing within eighteen (18) months
after the Closing Date.
ARTICLE VIII.
NO BROKER
---------
Buyer and Seller all represent and warrant that all introductions,
discussions, negotiations and all dealing with respect to the transactions
contemplated herein have been undertaken directly by the parties or their
representatives and that no other person, firm or entity has acted in this
contemplated transaction in any way, directly or indirectly, so as to give rise
to entitlement or claim to a finder's fee, brokerage fee or other like payment.
ARTICLE IX.
CLOSING DOCUMENTS
-----------------
The parties hereto shall execute such customary documents as may be
reasonably necessary for the implementation and consummation of the transaction
contemplated in this Agreement.
ARTICLE X.
SURVIVAL
The obligations and acts which are to be performed hereunder after the
Closing Date and the several covenants, representations, warranties and
agreements of the parties herein contained shall survive the Closing Date.
11
<PAGE>
ARTICLE XI.
REMEDIES ON DEFAULT OCCURRING AFTER CLOSING DATE
------------------------------------------------
In the event of a material breach of any term or condition of this
Agreement or any warranty or representation contained herein by either the Buyer
or the Seller arising after the Closing Date, the injured party may pursue all
remedies at equity and at law as it may determine in its sole discretion,
including specific performance, if applicable.
ARTICLE XII.
NO ASSIGNMENT
-------------
This Agreement shall not be assignable or delegable by either the Seller or
the Buyer.
ARTICLE XIII.
ENTIRE AGREEMENT; MODIFICATION
------------------------------
This Agreement embodies the entire Agreement between the parties hereto
with respect to the subject matter hereof. It supersedes any prior agreement or
understanding relating to the subject matter and may not be amended or modified
except by an instrument in writing duly executed by all of the parties hereto.
ARTICLE XIV.
HEADINGS
--------
The headings of the Articles of this Agreement are for convenience of
reference only and do not alter or affect the terms of this Agreement.
ARTICLE XV.
GOVERNING LAW
-------------
This Agreement shall be construed and governed in accordance with the laws
of the State of Florida and shall be deemed to have been negotiated and
performed in the State of Florida. Venue in any dispute arising hereunder shall
be in Broward County, Florida.
ARTICLE XVI.
NOTICE
------
All notices, demands, requests and correspondence shall be deemed duly
given if mailed by certified mail, postage prepaid, and addressed as follows:
If to the Seller: RADA Electronic Industries, Ltd.
--------------------------------
--------------------------------
12
<PAGE>
And to: Hadas Barnoy, Esq.
-------------------
-------------------
If to the Buyer: Jetborne International, Inc.
4010 Northwest 36th Avenue
Miami, Florida 33142
And to: Eugene M. Kennedy, Esq.
Eugene Michael Kennedy, P.A.
517 Southwest 1st Avenue
Ft. Lauderdale, FL 33301
ARTICLE XVII.
COUNTERPARTS
------------
This Agreement may be executed upon any number of identical counterparts
with the same effect as if the signature or signatures to each counterpart were
upon the same physical instruments.
WHEREFORE, the parties have hereunto set their hands and seals as of the
date first written above.
AS TO BUYER:
Jetborne International, Inc., a Delaware
corporation
BY: /s/R. Harkus
------------
R. Harkus, Director
(SEAL) ATTEST:
BY: /s/R. Harkus
------------
R. Harkus, Secretary
13
<PAGE>
AS TO SELLER:
RADA Electronic Industries, Ltd.,
an Israeli corporation
BY: /s/Haim Nissensen
-----------------
Chaim Nissensen, President
(SEAL) ATTEST:
BY: /s/Hadas Barnoy Tsror
---------------------
Hadas Barnoy Tsror, Secretary
14
Exhibit 2
<PAGE>
CAPITAL STOCK PURCHASE AND SALE AGREEMENT
THIS CAPITAL STOCK PURCHASE AND SALE AGREEMENT ("Agreement") is made this
15th day of September, 1997 by, between and among Bodstray Company, Ltd.
(hereinafter referred to as "BODSTRAY" or "Seller") and RADA Electronic
Industries, Ltd. (hereinafter referred to as "RADA" or "Buyer"), for the private
purchase and sale of approximately twenty-six (26%) percent of the issued and
outstanding capital stock of Jetborne International, Inc.
W I T N E S S E T H :
WHEREAS, the parties acknowledge that Jetborne International, Inc., a
publicly held Delaware corporation ("the Company") has authorized capital stock
comprised only of 14,000,000 (post-reverse split) shares of $.10 par value
Common Stock, of which 2,329,857 (post-reverse split) shares are issued and
outstanding as of the date of this Capital Stock Purchase Agreement (the
"Agreement"); and
WHEREAS, the parties acknowledge that Jetborne International, Inc. intends
to reverse split its Common Stock on a one (1) post-split share for ten (10)
pre-split shares basis on or about September 30, 1997; and
WHEREAS, the Buyer now holds approximately forty-nine (49%) percent of the
Capital Stock of the Company and is desirous of acquiring an additional
twenty-six (26%) percent of the Company now held by the Seller; and
WHEREAS, the Seller is agreeable to selling, transferring and conveying the
approximately twenty-six (26%) percent of the ownership interest in the Company
to the Buyer in exchange for the consideration hereinafter set out,
NOW THEREFORE, in consideration of the premises contained in this
Agreement, the parties hereby agree as follows:
ARTICLE I.
PURCHASE AND SALE
-----------------
The Seller shall sell, assign, transfer and convey to the Buyer 605,763
(post-split) shares of the restricted Common Stock of Jetborne International,
Inc. now held by the Seller (the "Shares").
ARTICLE II.
CLOSING
-------
Consummation of the transaction contemplated herein shall occur upon
delivery to the Buyer of the Shares as contemplated herein and shall constitute
the Closing which shall take place within ninety (90) days of full and final
execution of this Agreement.
1
<PAGE>
ARTICLE III.
CONSIDERATION
-------------
In exchange for the Shares, the Buyer shall issue to the Seller 700,000
shares of the restricted ordinary shares of RADA Electronic Industries, Inc.
As existing shareholders of Jetborne International, Inc. the parties make
no representations or warranties to each other regarding the Company or its
operations. Seller represents and warrants to the Buyer that Seller owns the
Shares free and clear in all respects and is fully authorized to enter into this
Agreement and perform all of its terms and conditions.
ARTICLE IV.
NO BROKER; NO ASSIGNMENT
------------------------
Buyer and Seller all represent and warrant that all introductions,
discussions, negotiations and all dealing with respect to the transactions
contemplated herein have been undertaken directly by the parties or their
representatives and that no other person, firm or entity has acted in this
contemplated transaction in any way, directly or indirectly, so as to give rise
to entitlement or claim to a finder's fee, brokerage fee or other like payment.
This Agreement shall not be assignable or delegable by either the Seller or the
Buyer.
ARTICLE V.
GOVERNING LAW
-------------
This Agreement shall be construed and governed in accordance with the laws
of the State of Florida and shall be deemed to have been negotiated and
performed in the State of Florida. Venue in any dispute arising hereunder shall
be in Broward County, Florida.
ARTICLE VI.
NOTICE
------
All notices, demands, requests and correspondence shall be deemed duly
given if mailed by certified mail, postage prepaid, and addressed as follows:
If to the Seller: Bodstray Company Limited
------------------------
------------------------
And to: ------------------------
------------------------
------------------------
2
<PAGE>
If to the Buyer: RADA Electronic Industries, Ltd.
--------------------------------
--------------------------------
And to: --------------------------------
--------------------------------
--------------------------------
ARTICLE VII.
COUNTERPARTS
------------
This Agreement may be executed upon any number of identical counterparts
with the same effect as if the signature or signatures to each counterpart were
upon the same physical instruments.
WHEREFORE, the parties have hereunto set their hands and seals as of the
date first written above.
AS TO BUYER:
RADA Electronic Industries, Ltd.,
an Israeli corporation
BY: /s/Haim Nissensen
-----------------
Chaim Nissensen, President
(SEAL) ATTEST:
BY: /s/Hadas Barnoy Tsror
---------------------
Hadas Barnoy Tsror, Secretary
3
<PAGE>
AS TO SELLER:
Bodstray Company Limited, a Hong
Kong corporation
BY: /s/Chaim Zimet
---------------------
Chaim Zimet, Director
(SEAL) ATTEST:
BY:
---------------------
, Secretary
4
