Saturday, March 20, 2010

Quasar Aerospace Industries, Inc. CEO Announces Acquisition of Herlong Airport Maintenance Company

Quasar Aerospace Industries,

Defense News: JACKSONVILLE, FL--(Marketwire - 03/19/10) - Quasar Aerospace Industries, Inc. (Pinksheets:QASP - News) --

Dean Bradley, the CEO of Quasar Aerospace Industries, Inc. announces the acquisition of Corporate Air Repair, Inc. This deal will add a top of the line maintenance capability to our growing fleet of aircraft for both Atlantic Aviation and our other corporate aircraft.

Corporate Air Repair is the Southeast's premier location for King Air phase inspections and pilot recurrent training.

Corporate Air Repair offers complete general aviation maintenance, annuals, 100 hour and pre-purchase inspections, as well as antique aircraft restorations, and multi-engine and ATP instruction.

Corporate Air Repair is operated by highly qualified technicians with decades of experience, having airframe and power plant certificates with FAA inspection authorization. The staff is both knowledgeable and aviation enthusiasts. Corporate Air Repair takes extreme pride in their craft and stand behind their work.

Corporate Air Repair's prior owner is Kenneth Oddy, an aviation icon with over four decades of pilot and mechanical experience. Mr. Oddy has agreed to stay on and manage the facility for at least a year and possibly longer. Ken has been providing maintenance services based at Herlong Airport for over 15 years. A retired airline captain, Ken flies and repairs a legendary variety of aircraft. He currently holds several FAA licenses including Commercial Pilot's license, ATP, CFII, MEI (land and seaplane), A & P Mechanic, and IA. He has logged approximately twenty five thousand hours as a pilot.

Joshua Henderson, President and Chief Operating Officer of Atlantic Aviation, Inc., states that this is a major step forward in building a fully integrated pilot training academy here at Herlong Airport.

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements as a result of various factors, and other risks. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and Quasar Aerospace Industries, Inc. undertakes no obligation to update such statements.

Triumph Group Announces Expiration and Results of Exchange Offer for Its 8% Senior Subordinated Notes Due 2017

Defense News: WAYNE, Pa.--(BUSINESS WIRE)--Triumph Group, Inc. (NYSE:TGI - News) today announced the expiration and results of its exchange offer (the “Exchange Offer”) to exchange up to $175 million in aggregate principal amount of its 8% Senior Subordinated Notes due 2017 that have been registered (the “Exchange Notes”) under the Securities Act of 1933, as amended (the “Securities Act”), for the same aggregate principal amount of its outstanding 8% Senior Subordinated Notes due 2017 (the “Original Notes”). The Original Notes were issued in a private placement in compliance with Rule 144A and Regulation S under the Securities Act.

The Exchange Offer expired at 5:00 p.m., New York City time, on March 16, 2010, and the settlement date of the Exchange Offer was March 19, 2010. According to U.S. Bank National Association, the exchange agent for the Exchange Offer, the Company received valid tenders from holders of $175 million aggregate principal amount, or 100%, of the Original Notes.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the Exchange Notes or any other security, and shall not constitute an offer, solicitation or sale in any jurisdiction in which or to any persons to whom such offering, solicitation or sale would be unlawful. The Exchange Offer was made only pursuant to the company’s prospectus dated February 16, 2010, which was filed with the Securities and Exchange Commission as part of the company’s Registration Statement on Form S-4.

Triumph Group, Inc., headquartered in Wayne, Pennsylvania, designs, engineers, manufactures, repairs and overhauls aircraft components and accessories. The company serves a broad, worldwide spectrum of the aviation industry, including original equipment manufacturers of commercial, regional, business and military aircraft and aircraft components, as well as commercial and regional airlines and air cargo carriers.

More information about the company can be found on the Internet at

Statements in this release which are not historical facts are forward-looking statements under the provisions of the Private Securities Litigation Reform Act of 1995. All forward-looking statements involve risks and uncertainties which could affect the company’s actual results and could cause its actual results to differ materially from those expressed in any forward looking statements made by, or on behalf of, the company. Further information regarding the important factors that could cause actual results to differ from projected results can be found in the company’s reports filed with the SEC, including without limitation the company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2009.

PharmAthene Contract Modification Subject to Suspension Pending Ruling on Competitor Protest

PharmAthene - Dedicated to a Safer World

Defense News: ANNAPOLIS, Md., March 19 /PRNewswire-FirstCall/ -- PharmAthene, Inc. (NYSE Amex: PIP), a biodefense company specializing in the development and commercialization of medical countermeasures against chemical and biological threats, announced today that pursuant to the Federal Acquisition Regulations and pending a ruling in a protest recently filed by a competitor the Department of Health and Human Services (HHS), through the Biomedical Advanced Research and Development Authority (BARDA), has suspended work under the modification the Company announced on February 23, 2010 to its existing contract with BARDA for the research and development of SparVax™. June 11, 2010 is the deadline to rule on the protest.

David P. Wright, President & Chief Executive Officer, commented "We are confident that BARDA has complied with all applicable legal and contractual requirements in entering into the modifications with PharmaAthene and that the contract modification for SparVax™ will be upheld once a ruling on the protest is issued. In the meantime, funding under the original NIH contract transferred to BARDA in April 2009 will continue to support ongoing advanced development activities for SparVax™ until a decision is reached. We are disappointed that a competitor - whose primary motivation should be protecting our citizens from bioterrorist threats - has chosen to pursue a path intended to delay development of a key medical countermeasure for our nation's biodefense arsenal."

The rPA contract modification was announced via a Special Notice (Solicitation Number: HHSO100200900103C) rPA Anthrax Vaccine Advance Development, issued by HHS on December 29, 2009. The original development contract for rPA vaccine (N01-Al-30052) was issued in 2003 and transferred to BARDA on April 1, 2009.

About SparVax™

SparVax™ is a novel second generation recombinant protective (rPA) anthrax vaccine being developed for pre and post exposure protection against anthrax infection. SparVax™ is a highly purified, well characterized, sub unit vaccine comprised of a single protein (recombinant PA) manufactured in E.coli. Phase I and Phase II clinical trials involving 770 healthy human subjects have been completed and showed that SparVax™ appears to be well tolerated and immunogenic in humans. These studies suggest that three doses of SparVax™, administered several weeks apart, should be sufficient to induce protective immunity. In non-clinical studies SparVax™ has also demonstrated the capability to protect rabbits and non-human primates against a lethal aerosol spore challenge of the anthrax Ames strain.

About PharmAthene, Inc.

PharmAthene was formed to meet the critical needs of the United States and its allies by developing and commercializing medical countermeasures against biological and chemical weapons. PharmAthene's lead product development programs include:

  • SparVax - a second generation recombinant protective antigen (rPA) anthrax vaccine
  • Third generation rPA anthrax vaccine
  • Valortim® - a fully human monoclonal antibody for the prevention and treatment of anthrax infection
  • Protexia® - a novel bioscavenger for the prevention and treatment of morbidity and mortality associated with exposure to chemical nerve agents

For more information about PharmAthene, please visit

Statement on Cautionary Factors

Except for the historical information presented herein, matters discussed may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Statements that are not historical facts, including statements preceded by, followed by, or that include the words "potential"; "believe"; "anticipate"; "intend"; "plan"; "expect"; "estimate"; "could"; "may"; "should"; or similar statements are forward-looking statements. PharmAthene disclaims, however, any intent or obligation to update these forward-looking statements. Risks and uncertainties include risks associated with the reliability of the results of the studies relating to human safety and possible adverse effects resulting from the administration of the Company's product candidates, unexpected funding delays and/or reductions or elimination of U.S. government funding for one or more of the Company's development programs, the award of government contracts to our competitors, unforeseen safety issues, challenges related to the development, scale-up, and/or process validation of manufacturing processes for our product candidates, unexpected determinations that these product candidates prove not to be effective and/or capable of being marketed as products as well as risks detailed from time to time in PharmAthene's Form 10-K and 10-Q under the caption "Risk Factors" and in its other reports filed with the U.S. Securities and Exchange Commission (the "SEC"). In particular, while the Company believes that the protest to the recent modification to the Company's existing contract with BARDA for the research and development of SparVax(TM) is unlikely to be sustained, if the GAO were to rule in favor of the protestor, such a ruling could have a material adverse effect on the financial position and operations of the Company. Copies of PharmAthene's public disclosure filings are available from its investor relations department and our website under the investor relations tab at

Related Headlines

LMI Aerospace to Present at the Sidoti & Company Fourteenth Annual Emerging Growth Institutional Investor Forum

LMI Aerospace, Inc. Logo (small)

Defense News: ST. LOUIS, March 19, 2010 (GLOBE NEWSWIRE) -- LMI Aerospace, Inc. (Nasdaq:LMIA - News), a leading provider of design engineering services, assemblies, kits and structural components to the aerospace, defense and technology industries, announced today it will present at the Sidoti & Company Fourteenth Annual Emerging Growth Institutional Investor Forum on March 23, 2010, at 2:50 p.m. EDT. The Sidoti Emerging Growth Institutional Investor Forum will be held at the Grand Hyatt Hotel in New York City March 23 to March 24, 2010.

Ronald S. Saks, President and Chief Executive Officer of LMI, and Lawrence E. Dickinson, Chief Financial Officer, will be presenting for the company.

LMI Aerospace, Inc. is a leading provider of design engineering services, structural components, assemblies and kits to the aerospace, defense and technology industries. Through its Aerostructures segment, the company primarily fabricates machines, finishes and integrates formed, close-tolerance aluminum and specialty alloy components and sheet-metal products, for large commercial, corporate and military aircraft. It manufactures more than 30,000 products for integration into a variety of aircraft platforms manufactured by leading original equipment manufacturers and Tier 1 aerospace suppliers. Through its Engineering Services segment, operated by its D3 Technologies, Inc. subsidiary, the company provides a complete range of design, engineering and program management services, supporting aircraft lifecycles from conceptual design, analysis and certification through production support, fleet support and service-life extensions.

The LMI Aerospace, Inc. logo is available at

Activists urge Australia to charge Japanese whalers

Defense News: SYDNEY (AFP) - – Anti-whaling activists have lodged a legal complaint against the captain and crew of a Japanese trawler which hit and sank their hi-tech speedboat, a politician said Friday.

Lawyers for Sea Shepherd Conservation Society's Paul Watson have written to Australian Federal Police calling for the prosecution of the Shonan Maru 2 crew over the collision with the Ady Gil, Greens Senator Bob Brown said.

Activists urge Australia to charge Japanese whalers

"The captain of the Japanese whaler that rammed the Ady Gil, endangering six lives in the process, should be prosecuted in Australia and face the appropriate sentence," Brown said.

Australian Federal Police said they had received a letter from lawyers for Watson regarding the January 6 collision and were assessing its contents.

"It would be inappropriate to comment further," a spokeswoman told AFP.

The Shonan Maru 2 and the Ady Gil collided in the Southern Ocean on January 6, with each side blaming the other for the smash which crippled the high-tech Ady Gil. The powerboat, which had its front sliced off, subsequently sank.

Brown said that, under Australian law, the captain of the Japanese vessel could face life imprisonment for his actions.

The Ady Gil was a carbon-and-kevlar trimaran which smashed the round-the-world record for a powerboat in 2008 under its former name, Earthrace.

Ady Gil captain Pete Bethune, 44, is in custody in Japan, awaiting a decision on whether he will be charged after allegedly riding out to the whaler under the cover of night on a jet ski in February and boarding it.

If convicted of trespass Bethune could face up to three years in prison or a fine of up to 100,000 yen (1,100 dollars).

Atom smasher reaches record energy levels: CERN

Defense News: GENEVA (AFP) - – The world's most powerful atom smasher has been brought up to a record energy level, the European Organisation for Nuclear Research said Friday, in readiness for collisions that could generate new discoveries in particle physics.

"At just after 5.20 this morning, two 3.5 TeV proton beams successfully circulated in the Large Hadron Collider for the first time," said CERN in a statement.

A view of a superconducting solenoid magnet at the European Organization for Nuclear Research (CERN) near Geneva. The world's most powerful atom smasher has been brought up to a record energy level, according to the European Organisation for Nuclear Research.

"This is the highest energy yet achieved in a particle accelerator, and an important step on the way to the start of the LHC research programme," it said.

"The first attempt to collide beams at 7 TeV (3.5 TeV per beam) will follow on a date to be announced in the near future," it added.

The particle collider -- inside a 27-kilometre (16.8-mile) tunnel straddling the Franco-Swiss border near Geneva -- is aimed at understanding the origins of the universe by recreating the conditions that followed the Big Bang.

The collider was revived after a 14-month breakdown last November, following a technical glitch that put it out of action days after it was launched in September 2008.

"We have crossed an important milestone that showed that we can reach an energy of 3.5 TeV," CERN spokesman James Gillies told AFP.

"But there are still some tests to be done before the collisions," he said adding that these collisions would not happen for "around ten days."

Before the LHC experiment, no particle accelerator had exceeded 0.98 TeV. One TeV is the equivalent to the energy of motion achieved by a flying mosquito.

US tanker bid war heats up with Airbus, Russia in wings

Defense News: WASHINGTON (AFP) - – The US Air Force tanker bidding contest against Boeing heated up, with Airbus parent EADS mulling a proposal and Russia's state firm UAC gearing up for one next week.

EADS opened the door to a bid against US arch-rival Boeing for the 35-billion-dollar aerial refueling tanker contract on signs of Pentagon willingness to extend the May deadline.

The European Aeronautic Defence and Space Company's expressed interest in the competition, and the surprise emergence of a Russian competitor late Friday, marked new twists in the long-running saga to replace the aging Boeing fleet.

The US Air Force tanker bidding contest against Boeing heated up, with Airbus parent EADS mulling a proposal and Russia's state firm UAC gearing up for one next week.

Just last week EADS, the parent of Airbus, was forced to withdraw from the bidding after its lead partner, US defense contractor Northrop Grumman, refused to compete, alleging the requirements were skewed in favor of Boeing.

Northrop's exit from the competition left the field open to the Chicago-based Boeing, the aerospace giant that built the tanker fleet in the 1950s and has promised a formal bid by May 10.

Military commanders view the planned KC-X aircraft as crucial to sustaining US air power and are anxious to replace the older Boeing KC-135 Stratotankers.

The turning point for EADS appeared late Thursday, when the Defense Department acknowledged it would consider "a reasonable extension" to the bidding deadline after learning from EADS it may reenter the fray.

"Yesterday the US Department of Defense (DoD) indicated it would welcome a proposal from EADS North America as prime contractor for the KC-X tanker competition," EADS said in a statement Friday.

"This is a significant development. EADS is assessing this new situation to determine if the company can feasibly submit a responsive proposal to the departments request for proposal," the company said.

Northrop declined to comment on the EADS statement.

EADS said it appreciated the Pentagon's signal of willingness to extend the time frame, but "in the end, the company will only submit a proposal if there is a fair chance to win, after evaluating all relevant factors."

EADS said "an important prerequisite" for its consideration of entry into the competition to provide 179 tankers would be "a significant extension to the period within which to prepare and submit a proposal."

The Defense Department, meanwhile, said that EADS was seeking a 90-day extension of the deadline.

"We would consider reasonable extensions," Pentagon spokesman Bryan Whitman said, adding that the "next step is for them to give us some specifics in terms of what they need the additional time for."

The Pentagon spokesman confirmed that EADS could bid to be the sole contractor without a US partner "as long as they meet the requirements."

The field appeared to widen suddenly to at least a two-way race after a lawyer representing Russian state-owned aerospace group United Aircraft Corporation said the company would enter a bid with a US partner.

"They're going to announce Monday a joint venture with an American company to bid on the tanker program," attorney John Kirkland told AFP.

Kirkland did not identify the US firm but said it was publicly traded.

The DoD could not immediately confirm the upcoming Russian bid.

"We've always been clear that this is a fair and open competition and we welcome all qualified bidders," Geoff Morell, a Pentagon spokesman, told AFP.

According to a source familiar with the situation, UAC will propose a tanker version of its Ilyushin IL-96, to be built in Russia and assembled in the US southeastern region.

"Bizarre!" said Richard Aboulafia, vice president of analysis at the Teal Group.

"They have no chance at all. In addition to the obvious security concerns, there are strong doubts about their ability to create a jetliner thats up to Airbus or Boeing standards. Even if they did, the political obstacles would be insurmountable," he said in an email.

The Northrop-EADS withdrawal from the race has triggered an uproar in Europe, with French President Nicolas Sarkozy and German Chancellor Angela Merkel this week accusing Washington of bias in favor of the all-American Boeing plane.

The team had won the contract in February 2008, but the deal was canceled after a successful Boeing appeal to the investigative arm of Congress.

In 2003, the Pentagon awarded a contract to Boeing but later suspended it after an ethics scandal involving a company executive and an Air Force official. The Air Force official was later convicted of criminal conspiracy.

British Airways strike bites but passengers fly

Defense News: LONDON (AFP) - – British Airways (BA) cabin crew on Saturday began a three-day strike which will force the cancellation of hundreds of flights, but the airline said many of its passengers were able to travel.

The Unite union insisted the vast majority of its 12,000 cabin crew members were supporting the strike on its first day.

But BA said more than half of staff had come into work at its main hub at London's Heathrow airport and at Gatwick outside the capital, and as a result it was reinstating some short and long-haul flights over the next few days.

A Unite Union banner is hung next to a picket line by British Airways cabin crew members near the entrance to Gatwick Airport. British Airways cabin crew on Saturday began a three-day strike over pay and conditions which will ground hundreds of flights, but the airline said many of its passengers were able to fly.

Members of Unite, Britain's biggest trade union, walked out at midnight Friday after talks with BA chief executive Willie Walsh broke down in acrimony.

More than 1,000 flights were set to be cancelled in the first phase of the action, with a second walkout to follow for four days from March 27, targeting the busy Easter holiday period.

Reports said the expected chaos at BA's hubs at Heathrow and Gatwick had failed to materialise because the airline had made contingency plans for passengers.

BA initially said a total of 1,100 flights out of the approximately 1,950 scheduled to operate during the first strike will be cancelled.

The airline had confidently stated it would keep two-thirds of its passengers flying, using staff who are not striking and by offering travellers seats on 22 planes leased from other European airlines.

And the decision of many staff to report for work was helping to clear the backlog, the airline said.

"Cabin crew are continuing to report as normal at Gatwick and the numbers reporting at Heathrow are above the levels we needed to operate our published schedule," a BA spokeswoman said.

"At Heathrow, around 50 percent of cabin crew have reported as normal and we are therefore increasing the number of long-haul and short-haul flights in our schedule in the days ahead."

However, Unite claimed a number of planes were starting to 'stack up' on the ground at airports, with 85 parked planes at Heathrow alone.

Unite's joint leader Tony Woodley on Friday angrily accused BA of wanting "to go to war" after the talks broke down.

BA chief Walsh said the strike was "deeply regrettable" but defiantly promised passengers that many would be able to travel.

Walsh has dismissed concerns that unions in France and Germany would carry out action in sympathy with Unite.

Prime Minister Gordon Brown has condemned the strike, saying it was "in no-one's interest" and would cause "unacceptable inconvenience" to passengers.

He urged BA management and workers to hold fresh talks as soon as possible.

The main opposition Conservatives have accused the government of a weak response to the strike because Unite is a major donor to Brown's ruling Labour party.

Commentators, noting that railway signal workers also voted Friday to strike in the coming weeks, said the action could severely damage Brown ahead of an election expected on May 6.

BA cabin crew on some routes are paid almost twice as much as staff at their rivals Virgin.

The airline is attempting to revise working conditions as part of a cost-cutting push, which the union says will lead to the introduction of a "second tier workforce on poorer pay and conditions".

BA has warned staff taking part in the strike they will lose lucrative reductions on long-haul flights.

The airline, which is attempting to merge with Spanish rival Iberia, said last month it expected to notch up a record loss in the current financial year due to weak demand for air travel.

It made a better than expected pre-tax loss of 50 million pounds (57 million euros, 79 million dollars) in the last three months of 2009.

In December, BA won a legal battle to prevent a 12-day strike by cabin crew over Christmas and New Year after a judge ruled that a ballot of staff by Unite was invalid.

Russians, EADS eye rich U.S. aerial tanker deal

* Surprise Russian bid reported to be in works

* Pentagon says considering EADS request

* EADS says it has not decided whether to bid

* Senator Murray criticizes any deadline extension (Recasts with reported Russian bid, Pentagon comment)

By Jim Wolf and Maria Sheahan

Defense News:WASHINGTON/FRANKFURT, March 19 (Reuters) - A surprise Russian bid was reported in the works Friday for a multibillion-dollar U.S. aerial-refueling fleet even as Europe's EADS (EAD.PA) sought three more months for a possible bid of its own.

The fresh competitor is a joint venture due to be announced by a U.S. defense contractor and United Aircraft Corp of Russia, an aerospace consortium partly owned by the Russian government, said John Kirkland, a Los Angeles-based attorney representing the planned partnership.

Airbus A330MRTT

Image courtesy of EADS

Russian Foreign Minister Sergei Lavrov discussed the tanker contest with visiting U.S. Secretary of State Hillary Clinton in Moscow Friday and "would very much like to discuss it further before she leaves," Kirkland said, citing a senior Russian aerospace-trade official.

The developments shook up the U.S. Air Force's troubled, nearly decade-long effort to start replacing its fleet of Boeing-built KC-135 tankers, which are close to 50 years old on average.

They raised the prospect of a three-way contest pitting the Russians against EADS, the corporate parent of Airbus, and Chicago-based Boeing Co (BA.N).

The U.S. Defense Department is "right now seriously considering the extension request from EADS," Geoff Morrell, the Pentagon press secretary, said in an emailed statement. The current deadline is May 10.

"We have always made clear that this is a fair and open competition and we welcome all qualified bidders," he added in response to a question about the reported Russian offer.

EADS, which lost its U.S. partner for the job last week, could rejoin the race if it determines "there is a fair chance to win, after evaluating all relevant factors," the company said earlier on Friday.

Northrop Grumman Corp (NOC.N), teamed with EADS, bested Boeing for a 2008 deal to build an initial 179 tankers, only to have that award canceled after U.S. auditors found the Air Force had failed to follow its own judging rules.

Los Angeles-based Northrop, which would have been the prime contractor, withdrew on March 8 from the planned rematch, which is valued at up to $50 billion.

In dropping plans to bid, Northrop Chief Executive Wes Bush said the Pentagon's final tender "clearly favors" Boeing's smaller 767-based plane over the larger Airbus A330 derivative pitched by EADS.

EADS had hoped to use the tanker contract as a beachhead in United States, the world's most lucrative market for military goods.

The Pentagon, battling cries of foul and charges of protectionism from European allies, reiterated on Thursday that it would welcome an EADS bid and would weigh a "reasonable" deadline extension.

Senator Patty Murray, a Democrat from Washington state, where Boeing would do much of its tanker work, said she was disappointed the Defense Department was "even considering giving in to Airbus" and extending the deadline.

"I believe in a fair and open competition, but this is no time to put American service members and workers on hold while a foreign company waffles," she said in a statement.

In the latest twist, Russia's UAC would seek to offer a tanker version of its Ilyushin Il-96 widebody jetliner, dubbed the Il-98, Kirkland said in a telephone interview.

The planes would be largely built in Russia, and assembled in the United States, according to the Wall Street Journal, the first to report the plan.

"They've been planning this for more than a year," Kirkland said, adding he had been involved for more than six months. "If it's a fair competiontion, UAC wins," he said. He declined to name the U.S. joint venture partner, but said it was publicly traded and due to be announced by Monday.

Prime Minister Vladimir Putin told Clinton at a meeting in Russia on Friday that Russian companies needed more help to penetrate the U.S. market.

EADS, in its statement, said the Defense Department had welcomed a possible proposal under which EADS North American unit would be prime contractor, not merely the partner of a U.S.-based firm.

The company declined to comment on how long of an extension it was seeking. Indeed, EADS still has not decided whether it will bid at all, but extending the deadline is a critical first step, said Guy Hicks, a spokesman.

EADS North America became a prime contractor for the Pentagon when it was selected in 2006 to build UH-72A Lakota light utility helicopters for the U.S. Army.

Boeing, the Pentagon's No. 2 contractor by sales after Lockheed Martin Corp (LMT.N). recognized it must earn the deal by meeting or beating all requirements with a tanker that is "cost-effective to buy, own and operate," said spokesman William Barksdale in an email.

This is the third attempt since 2001 to start buying new tankers, which are used to refuel other planes in mid-air.

The first effort, a $21.5 billion plan to lease and buy Boeing 767 tankers, collapsed in an ethics scandal that sent two Boeing employees to prison for conflict of interest, one of them a former top Air Force arms buyer. The second contract award took place in February 2008 before it was canceled.

In line with Northrop, EADS has said the U.S. Air Force's terms for the rematch are skewed in favor of Boeing's smaller 767-based tanker and fail to give enough credit for the added capability of the larger Airbus A330.

EADS shares closed up 1.0 percent at 14.83 euros on the Paris stock exchange on Friday.

Boeing shares closed 15 cents lower in New York. They had been up earlier in the session, lifted by the company's statement that it will accelerate planned production increases of its 777 and 747 aircraft. [ID:nN19126100] (Reporting by Jim Wolf and Adam Entous in Washington, and Maria Sheahan in Frankfurt; Editing by David Gregorio)