EXHIBIT 1
Schedule I
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THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "1933 ACT"). THIS AGREEMENT SHALL NOT CONSTITUTE AN
OFFER TO SELL NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY
JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE
SECURITIES ARE "RESTRICTED" AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS
PERMITTED UNDER THE 1933 ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
STOCK PURCHASE WARRANT
To Purchase 360,000 Shares of Common Stock of
RADA ELECTRONIC INDUSTRIES, LTD.
THIS CERTIFIES that, for value received, __________________________(the
"Investor"), is entitled, upon the terms and subject to the conditions
hereinafter set forth, at any time on or after the date hereof and on or prior
to __ May, 2000, (the "Termination Date") but not thereafter, to subscribe for
and purchase from RADA ELECTRONIC INDUSTRIES, LTD., an Israeli corporation with
headquarters situated at ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇ 4612
(the "Company"), 360,000 Ordinary Shares of 0.02 NIS (New Israeli Shekels) each
(the "Warrant Shares"). The purchase price of one Warrant Share (the "Exercise
Price") under this Warrant shall be US $1.5 (one and a half US Dollars) per
share for 120,000 Warrant Shares, US $2 (two US Dollars) for 120,000 Warrant
Shares and US $2.5 (two and a half US Dollars) for one 120,000 Warrant Shares.
This Warrant is being issued pursuant a Loan Agreement dated __ May,1998 (the
"Agreement") between the Company and the Investor and is subject to its terms.
In the event of any conflict between the terms of this Warrant and the
Agreement, the Agreement shall prevail.
1. Interpretation and Title of Warrant. (a) In this Warrant the term
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"Common Stock" shall mean Ordinary Share of 0.02 NIS (New Israeli Sekels) each
of the Company.
(b) Prior to the expiration hereof and subject to compliance with applicable
laws, this Warrant and all rights hereunder are transferable, in whole or in
part, at the office or agency of the Company, by the holder hereof in person or
by duly authorized attorney, upon surrender of this Warrant together with the
Assignment From annexed hereto properly endorsed.
2. Authorization of Shares. The Company covenants that all shares of
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Common Stock which may be issued upon the exercise of rights represented by this
Warrant will, upon exercise of the rights represented by this Warrant, be duly
authorized, and be capable of being validly issued, as fully paid and
nonassessable and
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free from all taxes, liens and charges in respect of the issue thereof (other
than taxes in respect of any transfer occurring contemporaneously with such
issue).
3. Exercise of Warrant. Exercise of the purchase rights represented by
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this Warrant may be made at any time or times, in whole or in part, before the
close of business on the Termination Date, or such earlier date on which this
Warrant may terminate as provided on paragraph 11 below, by the surrender of his
Warrant and the Subscription From annexed hereto duly executed, at the office of
the Company (or such other office or agency of the Company as it may designate
by notice in writing to the registered older hereof at the address of such
holder appearing on the books of the Company) and upon payment of the Exercise
Price of the shares thereby purchased; whereupon the holder of this Warrant
shall be entitled to receive a certificate for the number of shares of Common
Stock so purchased immediately. Certificates for shares purchased hereunder
shall be delivered to the holder hereof within five business days after the date
on which this Warrant shall have been exercised as aforesaid. Payment of the
Exercise Price of the shares may be by certified check or cashier's check or by
wire transfer to an account designated by the Company in an amount equal to the
Exercise Price multiplied by the number of shares being purchased.
4. No Fractional Shares or Scrip. No fractional shares or scrip
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representing fractional shares shall be issued upon the exercise of this
Warrant.
5. Charges, Taxes and Expenses. Issuance of certificates for shares of
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Common Stock upon the exercise of this Warrant shall be made without charge to
the holder hereof for any issue or transfer tax or other incidental expense in
respect of the issuance of such certificate, all of which taxes and expenses
shall be paid by the Company, and such certificates shall be issued in the name
of the holder of this Warrant or in such name or names as may be directed by the
holder of this Warrant. In the event certificates for shares of Common Stock are
to be issued in a name other than the name of the holder of this Warrant, this
Warrant when surrendered for exercise shall be accompanied by the Assignment
Form attached hereto duly executed by the holder hereof, together with evidence
reasonably satisfactory to the Company that such transfer or assignment is being
made in compliance with all applicable US federal and state securities laws
applicable to the Common Stock; and provided, that upon any such transfer or
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assignment, the Company may require, as a condition thereto, the payment of a
sum sufficient to reimburse it for any transfer tax incidental thereto.
6. Closing of Books. The Company will at no time close its shareholder
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books or records in any manner which interferes with the timely exercise of this
Warrant.
7. No Rights as Shareholder until Exercise. This Warrant does not entitle
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the holder hereof to any voting rights or other rights as a shareholder of the
Company prior to the exercise thereof. If, however, at the time of the surrender
of this Warrant and purchase the holder hereof shall be entitled to exercise
this Warrant, the shares so purchased shall be and be deemed to be issued to
such holder as the record owner of
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such shares as of the close of business on the date on which this Warrant shall
have been exercised.
8. Assignment and Transfer of Warrant. This Warrant may be assigned by
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the surrender of this Warrant and the Assignment Form annexed hereto duly
executed at the office of the Company (or such other office or agency of the
Company as it may designate by notice in writing to the registered holder
hereof at the address of such holder appearing on the books of the Company);
provided, however, that this Warrant may not be resold or otherwise transferred
except (I) in a transaction registered under the 1933 Act, or (ii) in a
transaction pursuant to an exemption under the 1933 Act, if available, from such
registration and whereby, if requested by the Company, an opinion of counsel
reasonably satisfactory to the Company is obtained by the holder of this Warrant
to the effect that the transaction is so exempt.
9. Loss, Theft, Destruction or Mutilation of Warrant. The Company
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represents and warrants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction of any Warrant or stock
certificate, and in case of loss, theft or destruction, of indemnity or security
reasonably satisfactory to it, and upon reimbursement to the Company of all
reasonable expenses incidental thereto, and upon surrender and cancellation of
such Warrant or stock certificate, if mutilated, the company will make and
deliver a new Warrant or stock certificate or like tenor and dated as of such
cancellation, in lieu of this Warrant or stock certificate.
10. Saturdays, Sundays, Holidays, etc. If the last or appointed day for
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the taking of any action or the expiration of any right required or granted
herein shall be a Saturday, Sunday or a legal holiday, then such action may be
taken or such right may be exercised on the next succeeding day not being legal
holiday.
11. Effect of Certain Events.
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(a) If at any time the Company proposes (I) to sell or otherwise convey
all or substantially all of its assets or (ii) to effect a transaction (by
merger or otherwise) in which more than 50% of the voting power of the Company
is disposed of (collectively, a "Sale or Merger Transaction"), in which the
consideration to be received by the Company or its shareholders consists solely
of cash, the Company shall give the holder of this Warrant thirty (30) days'
notice of the proposed effective date of the transaction specifying that the
Warrant shall terminate if the Warrant has not been exercised by the effective
date of the transaction.
(b) In case the Company shall at any time effect a Sale or Merger
Transaction in which the consideration to be received by the Company or its
shareholders consists in part of consideration other than cash, the holder of
this Warrant shall have the right thereafter to purchase, by exercise of this
Warrant and payment of the aggregate Exercise Price in effect immediately prior
to such action, the kind and amount of shares and other securities and property
which it would have owned or have been entitled to receive after the happening
of such transaction had this Warrant been exercised immediately prior thereto.
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12. Registration Rights. If the Company shall determine to register any
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of its securities either for its own account or the account of a security holder
or holders exercising their respective demand registration rights (whether or
not this Warrant has been exercised at that time), other than a registration
relating solely to employee benefit plans, or a registration relating to a
corporate reorganization or other transaction under Rule 145, or a registration
on any registration form that does not permit secondary sales, then the Company
shall (a) promptly give the Investor written notice thereof and (b) use its best
efforts, solely at the expense of the Company, to include in such registration
(and any related qualification under blue sky laws or other compliance), and in
any underwriting involved therein, all the Warrant Shares specified in a written
request made by the Investor and received by the Company within ten (10) days
after the written notice from the Company described in clause (a) above is
received by the Investor. Such written request may specify all or a part of the
Warrant Shares. In addition, the Company shall use its best efforts to qualify
for registration on Form S-3 or any comparable or successor form or forms. After
the Company has qualified for the use of Form S-3 or any comparable or successor
form or forms, the Investor shall have the right to request, and the Company
shall use its best efforts to effectuate (solely at the expense of the
Company), registrations on Form S-3 (or such other form), such requests to be in
writing and to state the number of Warrant Shares to be disposed of and the
intended methods of disposition of such Shares by the Investor. The rights
granted to the Investor under this Section 12 shall survive exercise of this
Warrant and the issuance of Common Stock to the Investor in connection herewith,
but shall terminate once all such Common Stock issued to the Investor pursuant
hereto may immediately be sold by the Investor under Rule 144 during any ninety
(90) day period.
13. Adjustments of Exercise Price and Number of Warrant Shares. The
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number and kind of securities purchasable upon the exercise of this Warrant and
the Exercise Price shall be subject to adjustment from time to time upon the
happening of certain events, as hereinafter set forth:
(a) In case the Company shall (i) declare or pay a dividend in shares
of Common Stock or make a distribution in shares of Common Stock to holders of
its outstanding Common Stock, (ii) subdivide its outstanding shares of Common
Stock, (iii) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock or (iv) issue any shares of its capital stock
in a reclassification of the Common Stock, the number of Warrant Shares
purchasable upon exercise of this Warrant immediately prior thereto shall be
adjusted so that the holder of this Warrant shall be entitled to receive the
kind and number of Warrant Shares or other securities of the Company which he
would have owned or have been entitled to receive had such Warrant been
exercised in advance thereof. An adjustment made pursuant to this clause shall
become effective immediately after the effective date of such event.
(b) In case the Company shall issue rights, options or warrants to
holders of its outstanding Common Stock entitling them at any time prior to the
exercise of this Warrant, to subscribe for or purchase shares of Common Stock or
securities convertible into or exchangeable or exercisable for Common Stock at a
Price Per Share (as defined in paragraph (d) below) which is lower at the date
of issuance thereof than the then Current Market Price (as defined in paragraph
(e) below) per
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share of Common Stock at such date, the number of Warrant Shares hereafter
purchasable upon the exercise of this Warrant shall be determined by multiplying
the number of Warrant Shares theretofore purchasable upon exercise of this
Warrant by a fraction, of which the numerator shall be the number of shares of
Common Stock outstanding on the date of issuance of such rights, options or
warrants plus the number of additional shares of Common Stock actually
subscribed for and purchased, as a consequence of the issuance of such rights,
options or warrants, and of which the denominator shall be the number of shares
of Common Stock outstanding on the date of issuance of such rights, options or
warrants plus the number of shares which the aggregate Proceeds (as defined in
paragraph (d) below) received by the Company on exercise of such rights, options
and warrants would purchase at the Current Market Price per share of Common
Stock at the date of issuance of such rights, options or warrants. Such
adjustment shall be made whenever such rights, options or warrants are issued,
and shall become effective on the date of distribution retroactive to the record
date for the determination of stockholders entitled to receive such rights,
options or warrants.
(c) In case the Company shall distribute to holders of its shares of
Common Stock evidences of its indebtedness or assets (excluding dividends or
distributions referred to in paragraph (a) above or in the paragraph immediately
following this paragraph and excluding any dividend or distribution paid out of
the regained earnings of the Company) or rights, options or warrants, or
convertible or exchangeable securities containing the rights to subscribe for or
purchase shares of Common Stock (excluding those referred to in paragraph (b)
above), then in each case the number of Warrant Shares thereafter purchasable
upon the exercise of this Warrant shall be determined by multiplying the number
of Warrant Shares theretofore purchasable upon the exercise of this Warrant by a
fraction, of which the numerator shall be the then Current Market Price per
share of Common Stock on the date of such distribution, and of which the
denominator shall be such Current Market Price, less the then fair value (as
determined by the Board of Directors of the company, whose determination shall
be conclusive) of the portion of the assets or evidences of indebtedness so
distributed or of such subscription rights, options or warrants, or of such
convertible or exchangeable securities applicable to one share of Common Stock.
Such adjustment shall be made whenever any such distribution is made, and shall
become effective on the date of distribution retroactive to the record date for
the determination of shareholders entitled to receive such distribution.
(d) For purposes of this Section 13, "Price Per Share" shall be defined
and determined according to the following formula:
R
P = ---------
N
Where
P = Price Per Share,
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R = the "Proceeds" received or receivable by the Company which (i) in the
case of shares of Common Stock is the total amount received or
receivable by the company in consideration for the sale and issuance
of such shares; (ii) in the case of rights, options or warrants to
subscribe for or purchase shares of Common Stock or of securities
convertible into or exchangeable or exercisable for shares of Common
Stock, is the total amount received or receivable by the company in
consideration for the sale and issuance of such rights, options,
warrants or convertible or exchangeable or exercisable securities,
plus the minimum aggregate amount of additional consideration, other
than the surrender of such convertible or exchangeable securities,
payable to the company upon exercise, conversion or exchange thereof;
and (iii) in the case of rights, options or warrants to subscribe for
or purchase convertible or exchangeable or exercisable securities, is
the total amount received or receivable by the Company in
consideration for the sale and issuance of such rights, options or
warrants, plus the minimum aggregate amount of additional
consideration other than the surrender of such convertible or
exchangeable securities, payable upon the exercise, conversion or
exchange of such rights, options or warrants and upon the conversion
or exchange or exercise of the convertible or exchangeable or
exercisable securities; provided that in each case the proceeds
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received or receivable by the Company shall be deemed to be the gross
cash proceeds without deducting therefrom any compensation paid or
discount allowed in the sale, underwriting or purchase thereof by
underwriters or dealers or other performing similar services or any
expenses incurred in connection therewith,
and
N = the "Number of Shares," which (i) in the case of Common Stock is the
number of shares issued; (ii) in the case of rights, options or
warrants to subscribe for or purchase shares of Common Stock or of
securities convertible into or exchangeable or exercisable for shares
of Common Stock, is the maximum number of shares of Common Stock
initially issuable upon exercise, conversion or exchange thereof; and
(iii) in the case of rights, options or warrants to subscribe for or
purchase convertible or exchangeable or exercisable securities, is the
maximum number of shares of Common Stock initially issuable upon
conversion, exchange or exercise of the convertible, exchangeable or
exercisable securities issuable upon the exercise of such rights,
options or warrants.
If the Company shall issue shares of Common Stock or rights, options,
warrants or convertible or exchangeable or exercisable securities for a
consideration consisting, in whole or in part, of property other than cash, the
amount of such consideration shall be determined in good faith by the Board of
Directors of the Company whose determination shall be conclusive.
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(e) For the purpose of any computation under paragraphs (b), (c) or (d)
of this Section 13, the "Current Market Price" per share of Common Stock at any
date shall be the average of daily bid and asked price on Nasdaq of the Common
Stock for the thirty (30) trading days commencing 30 trading days before the
date of determination.
(f) Whenever the number of Warrant Shares purchasable upon the exercise of
this Warrant is adjusted, as herein provided, the Exercise Price per Warrant
Share payable upon exercise of this Warrant shall be adjusted by multiplying
such Exercise Price immediately prior to such adjustment by a fraction, of which
the numerator shall be the number of Warrant Shares (to which such Exercise
Price relate) purchasable upon the exercise of this Warrant immediately prior
to such adjustment, and of which the denominator shall be the number of such
Warrant Shares purchasable immediately thereafter, it being understood however,
that no such adjustment shall increase the aggregate Exercise Price payable
hereunder upon full exercise of this Warrant.
(g) No adjustment in the number of Warrant Shares purchasable hereunder
shall be required unless such adjustments, in the aggregate, would result in an
increase or decrease of at least one percent (1%) of the Exercise Price;
provided that any adjustments which by reason of this paragraph (g) are not
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required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations shall be made to the nearest cent or to
the nearest one-thousandth of a share, as the case may be.
(h) No adjustment in the number of Warrant Shares purchasable upon the
exercise of this Warrant need be made under paragraph (b), (c) or (d) if the
Company issues or distributes to the holder of this Warrant the shares, rights,
options, warrants or convertible or exchangeable securities, or evidences of
indebtedness or assets referred to in those paragraphs which the holder of this
Warrant would have been entitled to receive had this Warrant been exercised
prior to the happening of such event or the record date with respect thereto. In
no event shall the Company be required or obligated to make any such
distribution otherwise than in its sole discretion. No adjustment in the number
of Warrant shares purchasable upon the exercise of this Warrant need be made for
sales of Common Stock pursuant to a Company plan for reinvestment of dividends
or interest. No adjustment need be made for a change in the par value of the
Common Stock.
(i) In the event that at any time, as a result of an adjustment made
pursuant to paragraph (a) above, the holder of this Warrant shall become
entitled to purchase any securities of the Company other than shares of Common
Stock, hereafter the number of such other shares so purchasable upon exercise of
this Warrant and the Exercise Price of such shares shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Warrant Shares contained in
paragraph (a) through (h), inclusive, above.
14. Voluntary Adjustment by the Company. The Company may at its option,
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at any time during the term of this Warrant, reduce the then current Exercise
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Price to any amount and for any period of time deemed appropriate by the Board
of Directors of the Company.
15. Notice of Adjustment. Whenever the number of Warrant shares or number
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or kind of securities or other property purchasable upon the exercise of this
Warrant or the Exercise Price is adjusted, as herein provided, the Company shall
promptly mail by registered or certified mail, return receipt requested, to the
transfer agent for the Common Stock and to the holder of this Warrant notice of
such adjustment or adjustments setting forth the number of Warrant Shares (and
other securities or property) purchasable upon the exercise of this Warrant and
the Exercise Price of such Warrant Shares after such adjustment, setting forth a
brief statement of the facts requiring such adjustment and setting forth
computation by which such adjustment was made. Such notice, in absence of
manifest error, shall be conclusive evidence of the correctness of such
adjustment.
16. Authorized Shares. The Company covenants that during the period the
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Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of any purchase rights under this Warrant. The Company further
covenants that its issuance of this Warrant shall constitute full authority to
its officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for shares of the Company's Common
Stock upon the exercise of the purchase rights under this Warrant. The Company
will take all such reasonable action as may be necessary to assure that such
shares of Common Stock may be issued as provided therein without violation of
any applicable law or regulation, or of any requirements of Nasdaq or any
domestic securities exchange upon which the Common Stock may be listed.
17. Miscellaneous.
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(a) Issue Date. The provisions of this Warrant shall be construed and
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shall be given effect in all respects as if it had been issued and delivered by
the Company on the date hereof. This Warrant shall be binding upon any
successors or assigns of the Company. This Warrant shall be governed by and
construed according to the laws of England and Wales and the Company and the
Investor hereby irrevocably submit to the jurisdiction of the English Courts
save that the Investor reserves the right to commence any proceedings, suit
and/or actions in any legal jurisdiction in order to assert, defend and/or
enforce its rights, obligations and/or remedies whether hereunder or otherwise.
Without limiting the generality of the foregoing, it is agreed and understood
that the Investor may elect to commence any proceedings, suits and/or actions in
the federal or state courts located in the State of New York in order to assert,
defend and/or enforce its rights, obligations and/or remedies under the
provisions hereof relating to the United States securities laws, and the Company
hereby irrevocably submits to the jurisdiction of such courts in connection with
any such proceeding, suit or action.
(b) Restrictions. The holder hereof acknowledges that the Common Stock
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acquired upon the exercise of this Warrant, if not registered, may have
restrictions upon its resale imposed by state and federal securities laws.
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(c) Modification and Waiver. This Warrant and any provisions hereof may be
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changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of the same is sought.
(d) Notices. Any notice, request or other document required or permitted
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to be given or delivered to the holders hereof or the Company shall be delivered
or shall be sent by certified or registered mail, postage prepaid, to each such
holder at its address as shown on the books of the Company or to the Company at
the address set forth in the Agreement.
(e) Recovery of Attorney's Fees. Should any party bring an action to
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enforce the terms of this Agreement then, if Investor prevails in such action,
it shall be entitled to recovery of its attorney's fees from the company and, if
the Company prevails in such action, it shall be entitled to recovery of its
attorney's fees from the Purchaser.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed as a
Deed by its officers thereunto duly authorized.
Executed as a deed by
RADA ELECTRONIC INDUSTRIES LTD.
Acting by two of its officers
/s/ ▇▇▇▇ ▇▇▇▇▇▇ /s/ ▇▇▇▇ ▇▇▇▇▇▇
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By: ▇▇▇▇ ▇▇▇▇▇▇ By: ▇▇▇▇ ▇▇▇▇▇▇
Title: Director and Officer Title: CFO
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NOTICE OF EXERCISE
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(1) The undersigned hereby elects to purchase ________________ shares of
Common Stock of RADA ELECTRONIC INDUSTRIES, LTD. pursuant to the terms of the
attached Warrant, and tenders herewith payment of the purchase price in full,
together with all applicable transfer taxes, if any.
(2) Please issue a certificate of certificates representing said shares of
Common Stock in the name of the undersigned or in such other name as specified
below:
Name: ____________________
Address: ____________________
____________________
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ASSIGNMENT FORM
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(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby
are hereby assigned to
________________________________ whose address is _________________________
____________________________________________.
_____________________________________________________
Dated:_______________ , 199_.
Holder's Signature: ______________________
Holder's Address: ______________________
______________________
Signature Guaranteed: ______________________________________________
NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatsoever, and must be guaranteed by a bank or trust company. Officers
of corporations and those acting in an fiduciary or other representative
capacity should file proper evidence of authority to assign the foregoing
Warrant.