Jacob and Chana Pinson, et al. - Page 7




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          officer of the company, oversaw all financial and administrative            
          functions.  Each of the men, however, performed a variety of                
          duties within the organization.  As stated by Joseph Deitsch, “in           
          our company, * * * everybody is involved in everything” and                 
          “Everybody wears many hats.”                                                
          Flocktex Industries, Ltd.                                                   
               In the early 1970’s, David Deitsch began, at the suggestion            
          of his rabbi, to investigate the possibility of opening a                   
          business in Israel.  FIL was then established in 1974 as an                 
          Israeli corporation.  The company is located in Kiryat Malachi,             
          Israel, and manufactures flocked fabrics principally for use in             
          the production of drapery and upholstery.  Like DPC, FIL has at             
          all times been closely held by members of the Deitsch family.               
          Stock ownership during the years at issue is set forth below:               
               David Deitsch       .0001 percent                                      
               Sara Deitsch        .0001 percent                                      
               Mordecai Deitsch    20 percent                                         
               Joseph Deitsch      20 percent                                         
               Rachel Sandman      19.999 percent                                     
               B. Mayer Zeiler     20 percent                                         
               Jacob Pinson        20 percent                                         
          (Again, we note that the stipulated values total only 99.9992               
          percent.)                                                                   
               Financing for the startup of FIL was provided through the              
          Industrial Development Bank of Israel, Ltd., an Israeli                     
          governmental organization.  To obtain financing of this type, the           
          Deitsches were required to comply with conditions designed by               






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