EXHIBIT 5
INVESTMENT REPRESENTATION LETTER
AND SUBSCRIPTION AGREEMENT
March 30, 2005
Broadview Media, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxx, Xxxxxxxxx 00000
Gentlemen:
The undersigned hereby agrees to purchase from Broadview Media, Inc. (the
"Company") 500,000 units (the "Units") at a price of $1.25 per Unit, with each
Unit consisting of one share of Series B Preferred Stock, $0.01 par value per
share (the "Preferred Shares") and detachable Warrants to purchase two (2)
shares of Common Stock, $0.01 par value per share (the "Common Stock") at an
exercise price of $1.25 per share. The terms and provisions of the Preferred
Shares and the Warrants are set forth in Exhibits A and B, respectively. I
understand that the Preferred Shares, the common shares into which the Preferred
Shares are convertible (the "Conversion Shares"), the Warrants and the shares
purchasable through exercise of the Warrants (the "Warrant Shares"; and
collectively, with the Preferred Shares, the Conversion Shares and the Warrants,
the "Securities") have not been registered under the Securities Act of 1933, as
amended (the "Securities Act") on the ground that the acquisition of the
Securities by me is exempt under Section 4(2) thereof.
In partial consideration of the issuance of the Securities to me, I hereby
represent, warrant and agree as follows:
1. Knowledge of Reliance. I understand and recognize that the Company, in
claiming a Section 4(2) exemption for the issuance of the Securities, is relying
upon the statements and representations made by me in this letter.
2. Investment Purpose in Acquiring the Securities.
a) Generally. I am acquiring the Securities for my account for
investment purposes only and not with a view to their resale or distribution. I
have no present intention to divide my participation with others or to resell or
otherwise dispose of all or any part of the Securities. In making these
representations, I understand that in the view of the Securities and Exchange
Commission the statutory exemption referred to above would not be available if,
notwithstanding my representations, I have in mind merely acquiring the
Securities for resale upon the occurrence or nonoccurrence of some predetermined
event.
b) Accredited Investor. I am (i) an "accredited investor" as that
term is defined in Rule 501 of the General Rules and Regulations under the
Securities Act by reason of Rule 501, (ii) experienced in making investments of
this kind, and (iii) able to afford the entire loss of my investment in the
Securities.
c) Compliance With Securities Act. I agree that if I sell or
distribute the Securities in the future, I shall sell or distribute them
pursuant to the requirements of the Securities Act and applicable state
securities laws. I agree that I will not transfer any part of the Securities
without (i) effective registration under the Securities Act and applicable state
securities laws, or (ii) obtaining an opinion of counsel satisfactory in form
and substance to counsel for the Company stating that the proposed transaction
will not result in a prohibited transaction under the Securities Act and the
applicable state securities laws.
d) Restrictive Legend. I agree that you may place a restrictive
legend on the Securities containing substantially the following language:
"The Securities represented by this certificate have not been
registered under either the Securities Act of 1933, as
amended, or applicable state securities laws, and are subject
to an investment letter. They may not be sold, offered for
sale or transferred in the absence of an effective
registration under the Securities Act of 1933, as amended, and
the applicable state securities laws, or an opinion of counsel
satisfactory in form and substance to counsel for the Company
that such transaction will not result in a prohibited
transaction under the Securities Act of 1933, as amended, or
the applicable state securities laws."
e) Stop Transfer Order. I agree that the Company may place a stop
transfer order with its registrar and stock transfer agent covering all
certificates representing the Securities.
3. Knowledge of Restrictions Upon Transfer of the Securities. I understand
that the Securities are not freely transferable and may in fact be prohibited
from sale for an extended period of time and that, as a consequence thereof, I
may have extremely limited opportunities to dispose of the Securities. I
understand that Rule 144 of the Securities and Exchange Commission permits the
transfer of "restricted securities" of the type here involved only under certain
conditions, including a minimum one year holding period and availability to the
public of certain information concerning the Company. I understand that there
presently is only a limited market for shares of the Company's Common Stock and
that no assurance can be given that a public market for the Company's shares
will exist in the future or that the Company will meet the public information
requirement.
4. Registration Rights. I and the Company agree that for the Conversion
Shares and the Warrant Shares I shall be entitled to the registration and other
rights set forth in that Registration Rights Agreement, dated as of March 25,
2003, as if the Conversion Shares and Warrant Shares were part of the
"Registrable Securities" provided for therein and as if the date of such
Agreement were the date hereof.
5. Information About the Company. I acknowledge that I am a director and
the Chief Executive Officer of the Company and that, by reason of my positions
and relationship with the Company as well as other actions taken by me, I am
fully aware of and advised concerning the present financial condition of the
Company, its business affairs and its prospects for future business.
signature page follows
/s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
0000 - 000xx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxx 00000
SSN: ###-##-####
The undersigned hereby accepts this Agreement.
BROADVIEW MEDIA, INC.
By: /s/ H. Xxxxxxx Xxxxx
------------------------------------------
H. Xxxxxxx Xxxxx
Title: Chief Financial Officer
Dated: March 30, 2005
