exv10w5



 






	 	 	 	 	 



Exhibit 10.5





     THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES
ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED
ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR COMPLIANCE WITH RULE 144 PROMULGATED
UNDER SUCH ACT, OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE
REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL AND FROM ATTORNEYS REASONABLY ACCEPTABLE TO
THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.



U.S. HELICOPTER CORPORATION




WARRANT




     This Warrant is issued in connection with that certain Convertible Note Purchase Agreement
(the “Agreement”) dated as of October 26, 2005 by and between U.S. HELICOPTER CORPORATION, a
Delaware corporation (the “Company”), and PORTFOLIO LENDERS II, LLC (the “Holder”). Capitalized
terms used herein, but not otherwise defined, shall have the meaning given to them in the
Agreement.



     THIS CERTIFIES THAT, for value received, the Holder or its registered assigns is entitled to
purchase from the Company at any time or from time to time during the period specified in Paragraph
2 hereof 100,000 (one hundred thousand) fully paid and non-assessable shares of the Company’s
Common Stock, $.001 par value per share (the “Common Stock”), at an exercise price per share equal
to $0.50 per share (the “Exercise Price”).



     The term “Warrant Shares,” as used herein, refers to the shares of Common Stock purchasable
hereunder. The Warrant Shares and the Exercise Price are subject to adjustment as provided in
Paragraph 4 hereof. This Warrant is subject to the following terms, provisions, and conditions:



     1. Manner of Exercise; Issuance of Certificates; Payment for Shares. Subject to the
provisions hereof, this Warrant may be exercised by the holder hereof, in whole or in part, by the
surrender of this Warrant, together with a completed exercise agreement in the form attached hereto
(the “Exercise Agreement”), to the Company during normal business hours on any business day at the
Company’s principal executive offices (or such other office or agency of the Company as it may
designate by notice to the holder hereof), and upon (i) payment to the Company in cash, by
certified or official bank check or by wire transfer for the account of the Company of the Exercise
Price for the Warrant Shares specified in the Exercise Agreement or (ii) if the resale of the
Warrant Shares by the holder is not then registered pursuant to an effective registration statement
under the Securities Act of 1933, as amended (the “Securities Act”), delivery to the Company of a
written notice of an election to effect a “Cashless Exercise” (as defined in Section 11(c) below)
for the Warrant Shares specified in the Exercise Agreement.



 









 





The Warrant Shares so purchased shall
be deemed to be issued to the holder hereof or such holder’s designee, as the record owner of such
shares, as of the close of business on the date on which this Warrant shall have been surrendered,
the completed Exercise Agreement shall have been delivered, and payment shall have been made for
such shares as set forth above. Certificates for the Warrant Shares so purchased, representing the
aggregate number of shares specified in the Exercise Agreement, shall be delivered to the holder
hereof promptly after this Warrant shall have been so exercised. The certificates so
delivered shall be in such denominations as may be requested by the holder hereof and shall be
registered in the name of such holder or such other name as shall be designated by such holder. If
this Warrant shall have been exercised only in part, then, unless this Warrant has expired, the
Company shall, at its expense, at the time of delivery of such certificates, deliver to the holder
a new Warrant in substantially identical form and dated as of the date of such exercise
representing the number of shares with respect to which this Warrant shall not then have been
exercised.



     2. Period of Exercise. This Warrant is exercisable at any time or from time to time on or
after the date hereof and before 5:00 p.m., New York, New York time on the fifth anniversary of
such date (the “Exercise Period”).



     3. Certain Agreements of the Company. The Company hereby covenants and agrees as follows:




     (a) Shares to be Fully Paid. All Warrant Shares will, upon issuance in
accordance with the terms of this Warrant, be validly issued and outstanding, fully
paid, and nonassessable and free from all taxes, liens, and charges with respect to the
issue thereof.




     (b) Reservation of Shares. During the Exercise Period, the Company shall at
all times have authorized, and reserved free of preemptive rights and other similar
contractual rights of stockholders, for the purpose of issuance upon exercise of this
Warrant, a sufficient number of shares of Common Stock to provide for the exercise of
this Warrant.




     (c) Listing. The Company shall promptly secure the listing of the shares of
Common Stock issuable upon exercise of the Warrant upon each national securities exchange or
automated quotation system, if any, upon which shares of Common Stock are then listed
(subject to official notice of issuance upon exercise of this Warrant) and shall maintain,
so long as any other shares of Common Stock shall be so listed, such listing of all shares
of Common Stock from time to time issuable upon the exercise of this Warrant.




     (d) Successors and Assigns. This Warrant will be binding upon any entity
succeeding to the Company by merger, consolidation, or acquisition of all or substantially
all the Company’s assets.




     (e)
Notices Of Record Date, Etc. In the event of:





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               (i) any taking by the Company of a record of the holders of Common Stock for the
purpose of determining the holders who are entitled to receive any dividend or other distribution,



               (ii) any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company, or any transfer of all or substantially all
the assets of the Company to, or consolidation or merger of, the Company with or into any person,



               (iii) any voluntary or involuntary dissolution, liquidation or winding- up of the
Company,



               (iv) a sale of substantially all of the outstanding capital stock of the Company
or the issuance of new shares representing the majority of the Company’s right to vote, or



               (v) the initial public offering of the Company’s Common Stock,



then and in each such event the Company will mail to the Holder a notice specifying the record
date for voting or the date of closing, as applicable, of any event (a) through (e) above. Such
notice shall be delivered to the Holder at least 20 days prior to the date of the relevant event



     4. Adjustment and Antidilution Provisions. On or after the date of issuance of this
Warrant, the Warrant Exercise Price and number of shares issuable pursuant to this Warrant shall be
subject to adjustment as follows:




     (a) In case the Company shall (i) declare a dividend or make a distribution on its
outstanding shares of Common Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number of shares, or (iii) combine or
reclassify its outstanding shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for such dividend or distribution or
of the effective date of such subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by
multiplying the Exercise Price by a fraction, the denominator of which shall be the
number of shares of Common Stock outstanding after giving effect to such action, and the
numerator of which shall be the number of shares of Common Stock immediately prior to such
action. Such adjustment shall be made each time any event listed above shall occur.




     (b) Whenever the Exercise Price payable upon exercise of each Warrant is adjusted
pursuant to Subsection (a) above, the number of shares purchasable upon exercise of this
Warrant shall simultaneously be adjusted by multiplying the number of shares initially
issuable upon exercise of this Warrant by the Exercise Price in effect on the date hereof
and dividing the product so obtained by the Exercise Price, as adjusted.




     (c) All calculations under this Section 4 shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be. Anything in this Section 4 to the
contrary notwithstanding, the Company shall be entitled, but shall not be required, to make
such changes in the Exercise Price in addition to those required by this Section 4, as it
shall determine, in its sole discretion, to be advisable in order that any dividend or



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distribution in shares of Common Stock, or any subdivision, reclassification or combination
of Common Stock, hereafter made by the Corporation shall not result in any Federal Income
tax liability to the holders of the Common Stock or securities convertible into Common Stock
(including warrants).




     (d) Whenever the Exercise Price is adjusted, as herein provided, the Corporation shall
promptly cause a notice setting forth the adjusted Exercise Price and adjusted number of shares issuable upon exercise of each Warrant to be mailed to the Holder, at its last
address appearing in the Company’s Warrant Register. The Company may retain a firm of
independent certified public accountants selected by the Board of Directors (who may be the
regular accountants employed by the Company) to make any computation required by this
Section 4, and a certificate signed by such firm shall be conclusive evidence of the
correctness of such adjustment absent a showing of mathematical or other error.



     5. Issue Tax. The issuance of certificates for Warrant Shares upon the exercise of this
Warrant shall be made without charge to the holder of this Warrant or such shares for any issuance
tax or other costs in respect thereof, provided that the Company shall not be required to pay any
tax which may be payable in respect of any transfer involved in the issuance and delivery of any
certificate in a name other than the holder of this Warrant.



     6. No Rights or Liabilities as a Shareholder. This Warrant shall not entitle the holder
hereof to any voting rights or other rights as a shareholder of the Company. No provision of this
Warrant, in the absence of affirmative action by the holder hereof to purchase Warrant Shares, and
no mere enumeration herein of the rights or privileges of the holder hereof, shall give rise to any
liability of such holder for the Exercise Price or as a shareholder of the Company, whether such
liability is asserted by the Company or by creditors of the Company.



     7. Transfer, Exchange, and Replacement of Warrant.




     (a) Restriction on Transfer. This Warrant and the rights granted to the holder
hereof are transferable, in whole or in part, upon surrender of this Warrant, together with
a properly executed assignment in the form attached hereto, at the office or agency of the
Company referred to in Paragraph 7(e) below,
provided, however, that any transfer or assignment shall be subject to the conditions
set forth in Paragraph 7(f) hereof. Until due presentment for registration of transfer on
the books of the Company, the Company may treat the registered holder hereof as the owner
and holder hereof for all purposes, and the Company shall not be affected by any notice to
the contrary.




     (b) Warrant Exchangeable for Different Denominations. This Warrant is
exchangeable, upon the surrender hereof by the holder hereof at the office or agency of the
Company referred to in Paragraph 7(e) below, for new Warrants of like tenor representing in
the aggregate the right to purchase the number of shares of Common Stock which may be
purchased hereunder, each of such new Warrants to represent the right to purchase such
number of shares as shall be designated by the holder hereof at the time of such surrender.



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     (c) Replacement of Warrant. Upon receipt of evidence reasonably satisfactory
to the Company of the loss, theft, destruction, or mutilation of this Warrant and, in the
case of any such loss, theft, or destruction, upon delivery of an indemnity agreement
reasonably satisfactory in form and amount to the Company, or, in the case of any such
mutilation, upon surrender and cancellation of this Warrant, the Company, at its expense,
will execute and deliver, in lieu thereof, a new Warrant of like tenor.




     (d) Cancellation; Payment of Expenses. Upon the surrender of this Warrant in
connection with any transfer, exchange, or replacement as provided in this Paragraph 7, this
Warrant shall be promptly canceled by the Company. The Company shall pay all taxes (other
than securities transfer taxes) and all other expenses (other than legal expenses, if any,
incurred by the holder or transferees) and charges payable in connection with the
preparation, execution, and delivery of Warrants pursuant to this Paragraph 7.




     (e) Register. The Company shall maintain, at its principal executive offices
(or such other office or agency of the Company as it may designate by notice to the holder
hereof), a register for this Warrant, in which the Company shall record the name and address
of the person in whose name this Warrant has been issued, as well as the name and address of
each transferee and each prior owner of this Warrant.




     (f) Exercise or Transfer Without Registration. If, at the time of the
surrender of this Warrant in connection with any exercise, transfer, or exchange of this
Warrant, this Warrant (or, in the case of any exercise, the Warrant Shares issuable
hereunder), shall not be registered under the Securities Act of 1933, as amended (the
“Securities Act”) and under applicable state securities or blue sky laws, the Company may
require, as a condition of allowing such exercise, transfer, or exchange, (i) that the
holder or transferee of this Warrant, as the case may be, furnish to the Company a written
opinion of counsel, which opinion and counsel are reasonably acceptable to the
Company, to the effect that such exercise, transfer, or exchange may be made without
registration under said Act and under applicable state securities or blue sky laws, (ii)
that the holder or transferee execute and deliver to the Company an investment letter in
form and substance reasonably acceptable to the Company and (iii) that the
transferee be an “accredited investor” as defined in Rule 501(a) of Regulation D
promulgated under the Securities Act; provided that no such opinion, letter or status as
an “accredited investor” shall be required in connection with a transfer pursuant to
Rule
144 under the Securities Act. The first holder of this Warrant, by taking and holding
the same, represents to the Company that such holder is acquiring this Warrant for
investment and not with a view to the distribution thereof.



     8. Registration Rights. The holder of this Warrant shall have the same registration rights
for the Warrant Shares as are described in the Agreement.



     9. Notices. All notices, requests, and other communications required or permitted to be
given or delivered hereunder to the holder of this Warrant shall be in writing, and shall be
personally delivered, or shall be sent by certified or registered mail or by recognized overnight
mail courier, postage prepaid and addressed, to such holder at the address shown for such holder on
the books of the Company, or at such other address as shall have been furnished to the Company by
notice from such holder. All notices, requests, and other communications required



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or permitted to
be given or delivered hereunder to the Company shall be in writing, and shall be personally
delivered, or shall be sent by certified or registered mail or by recognized overnight mail
courier, postage prepaid and addressed, to the office of the Company at 6 East River Piers, Suite
216, Downtown Manhattan Heliport, New York, New York 10004, Attention: Chief Executive Officer, or
at such other address as shall have been furnished to the holder of this Warrant by notice from the
Company. Any such notice, request, or other communication may be sent by facsimile, but shall in
such case be subsequently confirmed by a writing personally delivered or sent by certified or
registered mail or by recognized overnight mail courier as provided above. All notices, requests,
and other communications shall be deemed to have been given either at the time of the receipt
thereof by the person entitled to receive such notice at the address of such person for purposes of
this Paragraph 9, or, if mailed by registered or certified mail or with a recognized overnight mail
courier two business days following deposit with the United States Post Office or such
overnight mail courier, if postage is prepaid and the mailing is properly addressed, as the case
may be.



     10. Governing Law. THIS WARRANT SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS. THE PARTIES HERETO HEREBY
SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE UNITED STATES FEDERAL COURTS LOCATED IN NEW YORK, NEW
YORK WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS WARRANT, THE AGREEMENTS ENTERED INTO IN
CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. BOTH PARTIES IRREVOCABLY
WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH SUIT OR PROCEEDING. BOTH
PARTIES FURTHER AGREE THAT SERVICE OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE
DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR PROCEEDING.
NOTHING HEREIN SHALL AFFECT EITHER PARTY’S RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW. BOTH PARTIES AGREE THAT A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL
BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER
LAWFUL
MANNER. THE PARTY WHICH DOES NOT PREVAIL IN ANY DISPUTE ARISING UNDER THIS WARRANT SHALL BE
RESPONSIBLE FOR ALL FEES AND EXPENSES, INCLUDING ATTORNEYS’ FEES, INCURRED BY THE PREVAILING PARTY
IN CONNECTION WITH SUCH DISPUTE.



11. Miscellaneous.





     (a) Amendments. This Warrant and any provision hereof may only be amended by
an instrument in writing signed by the Company and the holder hereof.




     (b) Descriptive Headings. The descriptive headings of the several paragraphs
of this Warrant are inserted for purposes of reference only, and shall not affect the
meaning or construction of any of the provisions hereof.



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     (c) Cashless Exercise. Notwithstanding anything to the contrary contained in
this Warrant, if the resale of the Warrant Shares by the holder is not then registered
pursuant to an effective registration statement under the Securities Act, at the sole
discretion of the Company, this Warrant may be exercised by presentation and surrender of
this Warrant to the Company at its principal executive offices with a written notice of the
holder’s intention to effect a cashless exercise, including a calculation of the number of shares of Common Stock to be issued upon such exercise in accordance with the terms hereof (a “Cashless Exercise”). In the event of a Cashless Exercise, in lieu of paying the
Exercise Price in cash, the holder shall surrender this Warrant for that number of shares of
Common Stock determined by multiplying the number of Warrant Shares to which it would
otherwise be entitled by a fraction, the numerator of which shall be the difference between
the then current Market Price per share of the Common Stock and the Exercise Price, and the
denominator of which shall be the then current Market Price per share of Common Stock.




     (d) Remedies. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the holder, by vitiating the intent and purpose of
the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy
at law for a breach of its obligations under this Warrant will be inadequate and agrees, in
the event of a breach or threatened breach by the Company of the provisions of this Warrant,
that the holder shall be entitled, in addition to all other available remedies at law or in
equity, and in addition to the penalties assessable herein, to an injunction or injunctions
restraining, preventing or curing any breach of this Warrant and to enforce specifically the
terms and provisions thereof, without the necessity of showing economic loss and without any
bond or other security being required.



[The remainder of this page is intentionally left blank.]




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     IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized
officer.



	 	 	 	 	 
	 	U. S. HELICOPTER CORPORATION

 	 
	 	By:  	/s/ John G. Murphy
 	 
	 	 	John G. Murphy 	 
	 	 	Chief Executive Officer and President 	 
	 



Dated: October 26, 2005





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FORM OF EXERCISE AGREEMENT




Dated: ________ __, 200_




To:                                           




The undersigned, pursuant to the provisions set forth in the within Warrant, hereby agrees to
purchase ___shares of Common Stock covered by such Warrant, and makes payment herewith in
full therefor at the price per share provided by such Warrant in cash or by certified or official
bank check or by wire transfer for the account of the Company to [insert the Company’s wire
transfer details] in the amount of $___, or, if the resale of such Common Stock by the
undersigned is not currently registered pursuant to an effective registration statement under the
Securities Act of 1933, as amended, by surrender of securities issued by the Company (including a
portion of the Warrant) having a market value (in the case of a portion of this Warrant, determined
in accordance with Section 11(c) of the Warrant) equal to $___. Please issue a certificate
or certificates for such shares of Common Stock in the name of and pay any cash for any fractional
share to:



	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Signature:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Address:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 
	 	 	Note: The above signature should correspond exactly
with the name on the face of the within Warrant, if
applicable.	 	 






and, if said number of shares of Common Stock shall not be all the shares purchasable under the
within Warrant, a new Warrant is to be issued in the name of said undersigned covering the balance
of the shares purchasable thereunder less any fraction of a share paid in cash.




 









 








FORM OF ASSIGNMENT




     FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers all the rights of the
undersigned under the within Warrant, with respect to the number of shares of Common Stock covered
thereby set forth herein below, to:



	 	 	 	 	 
	Name of Assignee
	 	Address
	 	No. of Shares






, and hereby irrevocably constitutes and appoints                                                              as agent and
attorney-in-fact to transfer said Warrant on the books of the within-named corporation, with full
power of substitution in the premises.



Dated: ________ __, 200_




	 	 	 	 	 	 	 	 	 
	In the presence of:	 	 	 	 	 	 
	 	 	 	 	 
	 	
	 

	 	 	 	Name:        	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Signature: 	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 	 	Title of Signing
Officer or Agent (if any): 	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Address:  	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 
	 	 	 	 	Note: The above signature should correspond	 	 
	 	 	 	 	exactly with the name on the face of the	 	 
	 	 	 	 	within Warrant, if applicable.