EXHIBIT 10.70
CONVERTIBLE NOTE PURCHASE AGREEMENT
THIS AGREEMENT ("Agreement") is made as of this 20th day of February,
2008, between U.S. HELICOPTER CORPORATION (the "Company"), a Delaware
corporation, and XXXX XXXXXX (the "Purchaser").
RECITALS
WHEREAS, the Company has authorized the issuance and sale of the
Company's Promissory Note to Purchaser in the aggregate principal amount of
$300,000.00, having the terms set forth in Exhibit A attached hereto (the
"Note"); and
WHEREAS, the Purchaser desires to purchase, and the Company desires to
issue, the Note on the terms set forth in this Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the terms and
conditions contained in this Agreement, the Company and the Purchaser agree as
follows:
1. PURCHASE AND SALE OF THE NOTE.
1.1 Subject to the terms and conditions contained in this
Agreement, at the Closing (as hereinafter defined) the Purchaser shall purchase
from the Company and the Company shall sell to the Purchaser the Note for
$300,000.00 (THREE HUNDRED THOUSAND DOLLARS AND 00/100) (the "Loan Amount")
which shall be payable via wire transfer to the Company's designated account
(not later than the Closing Date).
1.2 The Note shall be repaid, along with all accrued and
unpaid interest, by the Company on the earlier of (1) the first closing of a
private placement of the Company's debt or equity securities (other than a
bridge loan financing), or (2) one year from the Closing Date (the "Maturity
Date").
1.3 The Note shall bear interest at the rate of 10% per annum
based on a 360-day year, 120 days' worth of which shall be paid by the Company
in advance on the Closing Date. The interest paid shall be non-refundable in the
event of early repayment.
1.4 The Purchaser shall have the right to convert the Loan
Amount plus any accrued but unpaid interest in whole or in part into shares of
the Company's common stock, par value $0.001 per share ("Common Stock") at a
conversion rate of $0.25 per share (such shares, the "Shares").
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2. INTENTIONALLY OMITTED.
3. CLOSING. The closing of the purchase and sale of the Note (the
"Closing") shall take place on February 20, 2008, or such other day as agreed to
by the parties (the "Closing Date").
4. REPRESENTATIONS AND WARRANTIES.
4.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants that as of the date of this Agreement:
(a) EXISTENCE. The Company is a corporation duly organized and
in good standing under the laws of the State of Delaware and is duly
qualified to do business and is in good standing in all states where
such qualification is necessary, except for those jurisdictions in
which the failure to qualify would not, in the aggregate, have a
material adverse effect on the Company's financial condition, results
of operations or business.
(b) AUTHORITY. The execution and delivery by the Company of
this Agreement and the Note (i) are within the Company's corporate
powers; (ii) are duly authorized by the Company's board of directors;
(iii) are not in contravention of the terms of the Company's
certificate of incorporation or bylaws; (iv) are not in contravention
of any law or laws; (v) except for the filing of a Form D Notice with
the Securities and Exchange Commission and any exemption filing related
thereto which may be required pursuant to applicable state securities
or "blue sky" laws, do not require any governmental consent,
registration or approval; (vi) do not contravene any contractual or
governmental restriction binding upon the Company; and (vii) will not
result in the imposition of any lien, charge, security interest or
encumbrance upon any property of the Company under any existing
indenture, mortgage, deed of trust, loan or credit agreement or other
material agreement or instrument to which the Company is a party or by
which the Company or any of the Company's property may be bound or
affected.
(c) BINDING EFFECT. This Agreement, the Note and the Warrant
have been duly authorized, executed and delivered by the Company and
constitute the valid and legally binding obligation of the Company,
enforceable in accordance with their respective terms, subject to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(d) DISCLOSURE DOCUMENTS. The Company has furnished the
Purchaser or made available at the website of the Securities and
Exchange Commission (the "SEC") (XXXX://XXX.XXX.XXX) a copy of the
Company's Quarterly Report on Form 10-QSB for the period ended
September 30, 2007 as filed with the SEC on November 20, 2007, and the
Company's Annual Report on Form 10-KSB for the period ended December
31, 2006 as filed with the SEC on April 17, 2007 (together, the "SEC
Documents").
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(e) SECURITIES MATTERS. Subject to the accuracy of the
representations of the Purchaser set forth in Section 4.2 hereof, the
offer, sale and issuance of the Note and the Shares as contemplated by
this Agreement are exempt from the registration requirements of the
Securities Act of 1933 as amended (the "Securities Act"). The Company
has complied and will comply with all applicable state "blue sky" or
securities laws in connection with the offer, sale and issuance of the
Note and the Shares as contemplated by this Agreement.
4.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser
represents and warrants that as of the date of the execution of this Agreement:
(a) AUTHORIZATION. This Agreement constitutes a valid and
legally binding obligation of the Purchaser.
(b) INVESTMENT REPRESENTATIONS. (i) The Purchaser has received
and reviewed the SEC Documents and the Purchaser or the Purchaser's
designated representatives have concluded a satisfactory due diligence
investigation of the Company and have had an opportunity to review the
documents provided by the Company and to have all of their questions
related thereto satisfactorily answered.
(ii) The Purchaser understands the fundamental risks
of the Note and the Shares; has determined that he/she/it can
reasonably benefit from the investment based upon net worth,
income, overall investment objectives and portfolio structure;
that the Purchaser's overall commitment to investments which
are not readily marketable is not disproportionate to the
Purchaser's net worth, and that the Note and the Shares will
not cause such overall commitment to become excessive; and,
that the Purchaser is able to bear the economic risk of the
Note and the Shares, including the loss of the entire value of
its investment. Additionally, the Purchaser understands that
that there are restrictions on the Purchaser's right to
liquidate the Note and the Shares.
(iii) The Purchaser has reviewed the Risk Factors
sections included in the SEC Documents, and understands the
Risk Factors describing the fact that the Company (a) has
substantial liabilities, (b) may not be able to obtain
sufficient funds to grow its business and the subsequent
financing may be on terms adverse to the Note and the Shares
and (c) is currently not profitable.
(iv) The Purchaser (or its members and/or officers)
has previously invested in unregistered securities and has
sufficient financial and investing expertise to evaluate and
understand the risks of the Note and the Shares.
(v) The Purchaser has received from the Company, and
is relying on, no representations or projections (except as
set forth in this Agreement or the SEC Documents) with respect
to the Company's business and prospects.
(vi) The Purchaser is an "accredited investor" within
the meaning of Regulation D under the Securities Act.
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(vii) The Purchaser is acquiring the Note and the
Shares for investment purposes only without intent to
distribute the same, and acknowledges that the Note and the
Shares have not been registered under the Securities Act and
applicable state securities laws, and accordingly, constitute
"restricted securities" for purposes of the Securities Act and
such state securities laws until such time as a registration
statement covering the Shares is declared effective by the SEC
and the states in which the registration statement is filed.
(viii) The Purchaser acknowledges that it will not be
able to transfer the Note and the Shares except upon
compliance with the registration requirements of the
Securities Act and applicable state securities laws or
exemptions therefrom.
(ix) The certificates and/or instruments evidencing
the Note and the Shares will contain a legend to the foregoing
effect until such time as a registration statement covering
the Shares is declared effective by the SEC.
5. REGISTRATION RIGHTS.
5.1 PARTICIPATION IN REGISTERED OFFERINGS. If the Company proposes or
is required to register any of its shares or other equity securities for public
sale for cash under the Securities Act of 1933, as amended (the "Act") (other
than on Forms S-4 or S-8 or similar registration forms), it will at each such
time or times give written notice to the Purchaser of its intention to do so.
Upon the written request of the Purchaser given within twenty (20) days after
receipt of any such notice, the Company shall use its best efforts to cause to
be included in such registration any Shares held by the Purchaser requested to
be registered; provided, that if the managing underwriter advises that less than
all of the shares requested to be registered should be offered for sale so as
not materially and adversely to affect the price or salability of such offering
being registered by the Company, the Purchaser (but not the Company to the
extent it desires to include shares for its own account) shall reduce the number
of its Shares to be included in the registration statement as required by the
underwriter to the extent requisite of all prospective sellers of the securities
proposed to be registered (other than the Company) on a pro rata basis according
to the amounts of securities proposed to be registered by all prospective
sellers to permit the sale or other disposition (in accordance with the intended
method of disposition thereof as aforesaid) by the prospective seller or sellers
of the securities so registered. The registration requested pursuant to this
Section 5.1 is referred to herein as the "Piggyback Registration".
5.2 OBLIGATIONS OF PURCHASER. It shall be a condition precedent to the
obligation of the Company to register any Shares pursuant to this Section 5 that
the Purchaser shall furnish to the Company such information regarding the Shares
held and the intended method of disposition thereof and other information
concerning the Purchaser as the Company shall reasonably request and as shall be
required in connection with the registration statement to be filed by the
Company. If after a registration statement becomes effective the Company advises
the Purchaser that the Company considers it appropriate to amend or supplement
the applicable registration statement, the Purchaser shall suspend further sales
of the Shares until the Company advises the Purchaser that such registration
statement has been amended or supplemented.
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5.3 If and whenever the Company is required by the provisions of this
Section 5 to effect the registration of the Shares under the Securities Act, the
Company will:
Furnish to the Purchaser such reasonable number of copies of
the registration statement, preliminary prospectus, final prospectus and such
other documents as the Purchaser may reasonably request in order to facilitate
the sale of such shares;
Notify the Purchaser, promptly after it shall receive notice
thereof, of the time when such registration statement has become effective or a
supplement to any prospectus forming a part of such registration statement has
been filed;
Notify the Purchaser promptly of any request by the Commission
for the amending or supplementing of such registration statement or prospectus
or for additional information;
Prepare and promptly file with the Commission and promptly
notify the Purchaser of the filing of such amendment or supplement to such
registration statement or prospectus as may be necessary to correct any
statements or omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Securities Act, any event shall
have occurred as the result of which any such prospectus or any other prospectus
as then in effect would include an untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein, in the
light of the circumstances in which they were made, not misleading; and
Advise the Purchaser, promptly after it shall receive
notice or obtain knowledge
thereof, of the issuance of any stop order by the Commission suspending the
effectiveness of such registration statement or the initiation or threatening of
any proceeding for that purpose and promptly use its best efforts to prevent the
issuance of any stop order or to obtain its withdrawal if such stop order should
be issued.
5.4 With respect to a registration required pursuant to this
Section 5, all fees, costs and expenses of and incidental to such registration,
shall be borne by the Company, including all registration, filing, printing
expenses, fees and disbursements of counsel and accountants for the Company, and
all legal fees and disbursements and other expenses of complying with state
securities or blue sky laws of any jurisdictions in which the Shares to be
offered are to be registered and qualified. Fees and disbursements of counsel
and accountants for the participating Purchaser and any other expenses incurred
by the Purchaser shall be borne by the Company; PROVIDED that the fees and
disbursements of counsel to the Purchaser shall not exceed $5,000 in connection
with a registration required under this Section 5.
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5.5 The Company will indemnify and hold harmless the Purchaser
and any underwriter for such Purchaser from and against, and will reimburse such
Purchaser and each such underwriter with respect to, any and all loss, damage,
liability, cost and expense to which such Purchaser or any such underwriter may
become subject under the Securities Act or otherwise, insofar as such losses,
damages, liabilities, costs or expenses are caused by any untrue statement or
alleged untrue statement of any material fact contained in such registration
statement, any prospectus contained therein or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they were made,
not misleading; PROVIDED, HOWEVER, that the Company will not be liable in any
such case to the extent that any such loss, damage, liability, cost or expenses
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission so made in conformity with information furnished
by such Purchaser or such underwriter in writing for use in the preparation
thereof.
5.6 The Purchaser will indemnify and hold harmless the
Company, any successor entity of the Company, its directors and officers, any
controlling person and any underwriter from and against, and will reimburse the
Company, its directors and officers, any controlling person and any underwriter
with respect to, any and all loss, damage, liability, cost or expense to which
the Company or any controlling person and/or any underwriter may become subject
under the Securities Act or otherwise, insofar as such losses, damages,
liabilities, costs or expenses are caused by any untrue statement or alleged
untrue statement of any material fact contained in such registration statement,
any prospectus contained therein or any amendment or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading, in each case to the extent that such untrue statement or alleged
untrue statement or omission or alleged omission was so made in reliance upon
and in conformity with written information furnished by or on behalf of such
Purchaser for use in the preparation thereof. The maximum aggregate liability of
each Purchaser pursuant to its indemnification obligations under this Section 5
shall not exceed the portion of the Purchase Price paid by such Purchaser
hereunder.
Promptly after receipt by an indemnified party pursuant to the
provisions of Sections 5.5 or 5.6 above of notice of the commencement of any
action involving the subject matter of the foregoing indemnity provisions such
indemnified party will, if a claim thereof is to be made against the
indemnifying party pursuant to the provisions of said Sections 5.5 or 5.6,
promptly notify the indemnifying party of the commencement thereof; but the
omission to so notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than hereunder.
In case such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party shall
have the right to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party.
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6. MISCELLANEOUS.
6.1 CONFIDENTIALITY. (a) The Purchaser agrees to keep
confidential any and all non-public information delivered or made
available to the Purchaser by the Company except for disclosures, as
necessary, made by the Purchaser to the Purchaser's officers,
directors, employees, agents, counsel and accountants each of whom
shall be notified by the Purchaser of this confidentiality covenant and
for whom the Purchaser shall be liable in the event of any breach of
this covenant by any such individual or individuals; provided, however,
that nothing herein shall prevent the Purchaser from disclosing such
information (a) upon the order of any court or administrative agency,
(b) upon the request or demand of any regulatory agency or authority
having jurisdiction over the Purchaser, (c) which has been publicly
disclosed or (d) to any of its members provided that any such members
agree in writing (with a copy provided to the Company) to be bound by
confidentiality provisions in form and substance substantially as are
contained herein. In the event of a mandatory disclosure as described
in clause (a) and/or (b) of the preceding sentence, the Purchaser shall
promptly notify the Company in writing of any applicable order, request
or demand for such information, cooperate with the Company if and to
the extent that the Company elects to seek an appropriate protective
order or other relief from such order, request, or demand, and disclose
only the minimal amount of information ultimately required to be
disclosed. The Purchaser shall not use for its own benefit, nor permit
any other person to use for such person's benefit, any of the Company's
non-public information including, without limitation, in connection
with the purchase and/or sale of the Company's securities.
(b) The Company shall in no event disclose non-public
information to the Purchaser, advisors to or representatives of the
Purchaser unless prior to disclosure of such information the Company
marks such information as "Non-Public Information - Confidential" and
provides the Purchaser, such advisors and representatives with the
opportunity to accept or refuse to accept such non-public information
for review. The Company may, as a condition to disclosing any
non-public information hereunder, require the Purchaser's advisors and
representatives to enter into a confidentiality agreement in form
reasonably satisfactory to the Company and the Purchaser.
(c) Nothing herein shall require the Company to disclose
non-public information to the Purchaser or its advisors or
representatives, and the Company represents that it does not
disseminate non-public information to any Purchasers who purchase stock
in the Company in a public offering, to money managers or to securities
analysts.
6.2 LEGENDS. To the extent applicable, each note, certificate or other
document evidencing the Note to be purchased and sold pursuant to this Agreement
and any Shares issued shall be endorsed with the legends set forth below, and
the Purchaser on behalf of itself and each holder of the Note covenants that,
except to the extent such restrictions are waived by the Company, it shall not
transfer the Note or Shares without complying with the restrictions on transfer
described in the legends endorsed on such Note or certificate:
(a) The following legend under the Securities Act:
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"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."
(b) If required by the authorities of any state in connection
with the issuance or sale of the Note or the Shares, the legend
required by such state authority.
(c) The legend set forth above shall be removed from the
Shares and the Company shall within two (2) business days issue a
certificate without such legend to the holder of the Shares upon which
it is stamped, if, unless otherwise required by state securities laws,
(i) in connection with a sale transaction, provided the Shares are
registered under the Securities Act or (ii) in connection with a sale
transaction, after such holder provides the Company with an opinion of
counsel, which opinion shall be in form, substance and scope customary
for opinions of counsel in comparable transactions, to the effect that
a public sale, assignment or transfer of the Shares may be made without
registration under the Securities Act. The legend set forth above shall
be removed from the Shares and the Company shall issue a certificate
without such legend to the holder of the Shares immediately upon the
registration of the Shares under the Securities Act in accordance with
this Agreement.
6.3 COSTS AND EXPENSES. The Company shall reimburse Purchaser for its
reasonable legal fees and expenses in connection with the purchase of the Note.
The Company shall be responsible for all of its fees and expenses in connection
with this transaction.
6.4 ASSIGNABILITY; SUCCESSORS. The provisions of this Agreement shall
inure to the benefit of and be binding upon the permitted successors and assigns
of the parties hereto.
6.5 SURVIVAL. All agreements, covenants, representations and warranties
made by the Company or by the Purchaser herein shall survive the execution and
delivery of this Agreement.
6.6 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED ACCORDING TO THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF
RELATING TO CONFLICTS OF LAWS.
6.7 COUNTERPARTS: HEADINGS. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but such counterparts
shall together constitute but one and the same agreement. The descriptive
headings in this Agreement are inserted for convenience of reference only and
shall not affect the construction of this Agreement.
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6.8 LEGAL REPRESENTATION.
(a) Each party hereto represents and warrants that it has
carefully read this Agreement and knows the contents hereof and that it
has signed this Agreement freely and voluntarily and that each party
has obtained independent counsel in reviewing this document and further
acknowledges that the law firm of Xxxxxxxxx, Xxxxxx & Xxxxxx has
memorialized the within Agreement and has provided legal advice solely
to the Company with respect to this Agreement.
(b) The Purchaser was provided the opportunity to retain
individual counsel, and has retained or waived the right to retain
individual counsel to review this Agreement.
6.9 ENTIRE AGREEMENT, AMENDMENTS. This Agreement and the Exhibits
contain the entire understanding of the parties with respect to the subject
matter hereof, and supersede all other representations and understandings, oral
or written, with respect to the subject matter hereof. No amendment,
modification, alteration, or waiver of the terms of this Agreement or consent
required under the terms of this Agreement shall be effective unless made in a
writing, which makes specific reference to this Agreement and which has been
signed by the Company and the Purchaser. Any such amendment, modification,
alteration, waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
6.10 NOTICES. All communications or notices required or permitted by
this Agreement shall be in writing and shall be deemed to have been given or
made when delivered in hand, deposited in the mail, or sent by facsimile, with
confirmation (if sent by facsimile on a non-business day, receipt shall be
deemed to have occurred on the next succeeding business day). Communications or
notices shall be delivered personally or by certified or registered mail,
postage, or by facsimile and addressed as follows, unless and until either of
such parties notifies the other in accordance with this Section of a change of
address:
IF TO THE COMPANY: U.S. Helicopter Corporation
0 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Xxxxxxxxx Heliport
Xxx Xxxx, XX 00000
Attn.: Xxxx X. Xxxxxx, President
Telephone: 000-000-0000
Fax: 000-000-0000
WITH A COPY TO: Xxxxxxxxx, Xxxxxx & Xxxxxx
000 Xxxxxxx Xxxxxxxxx
0xx Xxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxx, Esq.
Telephone: 000-000-0000
Fax: 000-000-0000
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IF TO THE PURCHASER: Xxxx Xxxxxx
[ Address]
Telephone: _____________
Fax: _____________
6.11 SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
6.12 MAXIMUM INTEREST. It is expressly stipulated and agreed to be the
intent of the Company and the Purchaser at all times to comply with the
applicable law governing the maximum rate of interest payable on or in
connection with all indebtedness and transactions hereunder (or applicable
United States federal law to the extent that it permits Purchaser to contract
for, charge, take, reserve or receive a greater amount of interest). If the
applicable law is ever judicially interpreted so as to render usurious any
amount of money or other consideration called for hereunder, or contracted for,
charged, taken, reserved or received with respect to any loan or advance
hereunder, or if acceleration of the maturity of the Note results in the
Company's having paid any interest in excess of that permitted by law, then it
is the Company's and the Purchaser's express intent that all excess cash amounts
theretofore collected by Purchaser be credited on the principal balance of the
Note (or if the Note has been or would thereby be paid in full, refunded to the
Company), and the provisions of this Agreement immediately be deemed reformed
and the amounts thereafter collectible hereunder reduced, without the necessity
of the execution of any new document, so as to comply with the applicable law,
but so as to permit the recovery of the fullest amount otherwise called for
hereunder. The right to accelerate maturity of the Note does not include the
right to accelerate any interest which has not otherwise accrued on the date of
such acceleration, and the Purchaser does not intend to collect any unearned
interest in the event of acceleration.
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the day
and year first above written.
U. S. HELICOPTER
CORPORATION
By:
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Xxxx X. Xxxxxx
Chief Executive Officer and President
------------------------------------
XXXX XXXXXX
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EXHIBIT A
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.
PROMISSORY NOTE
February __, 2008
THREE HUNDRED THOUSAND DOLLARS
10% NOTE
FOR VALUE RECEIVED, U.S. HELICOPTER CORPORATION, a Delaware corporation
(the "Company") hereby promises to pay to the order of XXXX XXXXXX (the
"Holder"), or his registered assigns, the principal sum of THREE HUNDRED
THOUSAND DOLLARS AND 00/100 ($300,000.00), and to pay interest from the date
hereof on the outstanding principal sum based on a 360-day year, such interest
to accrue from the date hereof (the "Closing Date"). The Note shall bear
interest at the rate of 10% per annum based on a 360 day year, of which 120
days' worth shall be paid by the Company in advance on the Closing Date. The
interest paid shall be non-refundable in the event of early repayment. The
principal and accrued but unpaid interest shall be paid in full on the earlier
of (1) the first closing of a private placement of the Company's debt or equity
securities (other than a bridge financing), or (2) one year from the Closing
Date (the "Maturity Date").
This Note is an authorized issue of a $300,000 10% Note of the Company
(the "Note") issued pursuant to a Note Purchase Agreement dated as of February
__, 2008 between the Company and the Holder (the "Note Purchase Agreement"). The
Holder of this Note is entitled to the benefits of the Note Purchase Agreement
and to enforce the agreements of the Company contained therein. Capitalized
terms used herein and not otherwise defined shall have the meaning ascribed
thereto in the Note Purchase Agreement. All payments shall be paid in lawful
money of the United States of America at the principal office of the Holder or
at such other place as the Holder may designate from time to time in writing to
the Company.
1. CONVERSION RIGHTS. The principal and any and all interest payable on
this Note shall be convertible, at the option of either the Holder, at any time
into shares of Company Common Stock at $0.25 per share (1,200,000 shares plus
any interest shares).
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2. DEFAULT. The Company shall be in default under this Note upon the
occurrence of any of the following events ("Event of Default"):
(a) Failure to make any principal or interest payment required
under this Note within three days of the date such payment is due;
(b) Any material default, breach or misrepresentation under
the terms and provisions of the Note Purchase Agreement that is not
cured after 30 days written notice by Holder to the Company; or
(c) An assignment for the benefit of creditors by or the
filing of a petition under bankruptcy, insolvency or debtor's relief
law, or for any readjustment of indebtedness, composition or extension
by the Company, or commenced against the Company which is not
discharged within sixty (60) days.
3. REMEDIES UPON EVENT OF DEFAULT. Upon the occurrence of an Event of
Default:
(a) specified in clause (c) of Section 2, then the Note shall
be automatically accelerated and immediately due and payable at the
option of Holder, without notice or demand;
(b) specified in clauses (a) or (b) of Section 2, then the
Holder may declare the Note immediately accelerated due and payable;
and
(c) the Holder shall have all of the rights and remedies, at
law and in equity, by statute or otherwise, and no remedy herein
conferred upon the Holder is intended to be exclusive of any other
remedy and each remedy shall be cumulative and shall be in addition to
every other remedy given hereunder or now or hereafter existing at law,
in, equity, by statute or otherwise.
4. REGISTRATION RIGHTS. The Holder of this Note shall have the
registration rights pertaining to the shares issuable upon conversion of this
Note as described in the Note Purchase Agreement.
5. CHANGES; PARTIES. This Note can only be changed by an agreement in
writing signed by the Company and the Holder. This Note shall inure to the
benefit of and be binding upon the Company and the Holder and their respective
successors and assigns.
6. WAIVER OF PRESENTMENT. The Company hereby waives presentment,
demand, notice, protest and all other demands and notices in connection with the
delivery, acceptance, performance, default or enforcement of this Note.
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7. MAXIMUM RATE OF INTEREST. It is expressly stipulated and agreed to
be the intent of the Company and Holder at all times to comply with the
applicable law governing the maximum rate of interest payable on or in
connection with all indebtedness and transactions hereunder (or applicable
United States federal law to the extent that it permits Holder to contract for,
charge, take, reserve or receive a greater amount of interest). If the
applicable law is ever judicially interpreted so as to render usurious any
amount of money or other consideration called for hereunder, or contracted for,
charged, taken, reserved or received with respect to any loan or advance
hereunder, or if acceleration of the maturity of this Note or the indebtedness
hereunder or if any prepayment by the Company results in the Company's having
paid any interest in excess of that permitted by law, then it is the Company's
and Holder's express intent that all excess cash amounts theretofore collected
by Holder be credited on the principal balance of this Note (or if this Note has
been or would thereby be paid in full, refunded to the Company), and the
provisions of this Note immediately be deemed reformed and the amounts
thereafter collectible hereunder reduced, without the necessity of the execution
of any new document, so as to comply with the applicable law, but so as to
permit the recovery of the fullest amount otherwise called for hereunder. The
right to accelerate maturity of this Note does not include the right to
accelerate any interest which has not otherwise accrued on the date of such
acceleration, and Holder does not intend to collect any unearned interest in the
event of acceleration.
8. NO IMPLIED WAIVER. No failure or delay on the part of Holder in
exercising any right, power or privilege under this Note and no course of
dealing between the Company and Holder shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder shall
preclude any other or further exercise of any right, power or privilege Holder
would otherwise have. No notice to, or demand on, the Company in any case shall
entitle the Company to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the right of Holder to any other or
further action in any circumstances without notice or demand.
9. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED ACCORDING TO THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF
RELATING TO CONFLICTS OF LAWS.
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IN WITNESS WHEREOF, the Company has executed this Note as of the day
and year set forth above.
U.S. HELICOPTER CORPORATION
By: _____________________________
Xxxx X. Xxxxxx
Chief Executive Officer and President
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