Investor Disclosure

Overview

Pursuant to Rule 302(b) of Securities and Exchange Commission (“SEC”) Regulation Crowdfunding under the Securities Act of 1933 (Title III of the JOBS Act), as amended (the “Securities Act”), all potential investors who open an account on Bioverge and/or commit to purchasing securities through Bioverge Portal, LLC are required to receive and acknowledge certain educational information including:

  • how securities on Bioverge Portal, LLC are offered and purchased
  • the risks of investing in such securities
  • the types of securities offered and any resale restrictions on such securities
  • investment limits for certain investors
  • the disclosure generally required to be made available by issuers offering securities on Bioverge Portal, LLC (“Issuers”)
  • the relationship between Bioverge Portal, LLC, posted Issuers and investors

Please review the important information below and in our FAQs before you register and especially before you make any investments!

About US

Bioverge Portal, LLC (the “Firm”) is a California limited liability company operating a Crowdfunding Platform (the “Platform”) through which issuers of securities may offer and sell private securities in offerings exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”) under Section 4(a)(6) thereof.

Issuers of securities will apply with the Firm to offer and sell their private securities through the Platform in accordance with the requirements of the Securities Act, Regulation Crowdfunding, and other applicable federal and state securities laws. Issuers will only be allowed to conduct an offering of their securities after satisfying the Firm’s requirements for offering securities through the Platform.

As a registered funding portal, Bioverge Portal, LLC is restricted from the following actitivies:

  • Offer investment advice or make recommendations; solicit purchases, sales or offers to buy securities; compensate promoters and other persons for solicitations or based on the sale of securities; and hold, possess, or handle investor funds or securities.
  • Allow companies to list securities on our platform that we have a reasonable basis for believing have the potential for fraud or raise other investor protection concerns.
  • Have a financial interest in a company that is offering or selling securities on our platform under Regulation Crowdfunding outside of financial interest paid as compensation for the services.
  • Compensate any person for providing us with personally identifiable information of any investor or potential investor.

Bioverge strives to provide value-add beyond the transaction, and as such there may or may not be an ongoing relationship between the issuer and Bioverge Portal, LLC.

An investment in the securities offered for sale by issuers through the Platform will carry specific risks that are not necessarily present when investing in other securities, particularly publicly-traded securities offered for sale through a stock exchange such as NASDAQ or the NYSE. These risks are described as follows:

  • The securities will be subject to substantial restrictions on transferability, and no public market may ever exist where such securities could be freely tradable.
  • Investors in securities through the Platform will have little opportunity to participate meaningfully in business decisions of the issuer. The issuer may decide to sell additional securities in the future, and prior investors may have no or limited rights with respect to approving or disapproving such sale of additional securities. In the event of such a sale, prior investors will experience dilution of their interest in the issuer. This dilution would decrease the investor’s limited voting rights with respect to the securities purchased.
  • An issuer must file a report annually, no later than 120 days after the end of the most recently completed fiscal year covered by the report. Issuers must post the annual report on their websites. The issuer is required to disclose information similar to that required in the offering statement, including disclosure about its financial condition that meets the highest financial statement requirements that were applicable to its offering statement. Notwithstanding the issuer’s initial obligation to provide these reports, the possibility existing that those obligations may terminate in the future.
  • The aggregate amount sold to any investor by an issuer, including any amount sold in reliance on the exemption provided under this paragraph during the 12-month period preceding the date of such transaction, does not exceed (i) the greater of $2,200 or 5 percent of the lesser of annual income or net worth of such investor, as applicable, if either the annual income or the net worth of the investor is less than $107,000; and (ii) 10 percent of the lesser of annual income or net worth of such investor, as applicable, not to exceed a maximum aggregate amount sold of $107,000, if either the annual income or net worth of the investor is equal to or more than $107,000. This New Account Application requests that you provide certain income and/or net worth information that will allow the Firm to ensure compliance with these requirements.
  • Investors may cancel an investment commitment until 48 hours prior to the deadline identified in the issuer’s offering materials.
  • If an investor does not cancel an investment commitment before the 48-hour period prior to the offering deadline, the funds will be released to the issuer upon closing of the offering and the investor will receive securities in exchange for his or her investment.
  • If an investor does not reconfirm his or her investment commitment after a material change is made to the offering, the investor’s investment commitment will be cancelled and committed funds will be returned.
  • If the sum of the investment commitments from all investors does not equal or exceed the target offering amount at the time of the offering deadline, no securities will be sold in the offering, investment commitments will be cancelled and committed funds will be returned without interest.
  • Investors should consider whether an investment in private securities such as those offered through the Platform are appropriate for the investor considering factors as the risks noted in these Educational Materials and the specific risks disclosed by the issuer in their offering materials.
  • An offering can be canceled by the issuer at any time, and for any reason, prior to closing.
  • Following completion of the offering of securities in which an investor may invest through the Platform, there may or may not be an ongoing relationship between the issuer and the Firm.
  • Under certain circumstances an issuer may cease to publish annual reports and, therefore, an investor may not continually have current financial information about the issuer.
  • Investor understands that the entire amount of his or her investment may be lost, and is in a financial condition to bear the loss of the investment. Investor acknowledges that it will not invest any funds in an offering made through the Firm’s Platform unless he or she can afford to lose the entire amount of his or her investment.

The Firm will make these Educational Materials available on its Platform at all times and, if at any time, the Firm makes a material revision to its educational materials, it will make the revised Educational Materials available to all investors before accepting any additional investment commitments or effecting any further transactions in securities offered and sold in reliance on section 4(a)(6) of the Securities Act (15 U.S.C. 77d(a)(6)).

By the investor’s signature of this New Account Application, the investor is certifying that investor has received, read and understood these Educational Materials prior to the time that the investor’s account with the Platform is opened.

Early Completion of Offering

The following provides important information regarding an issuer completing an offering prior to the original deadline set forth in the offering materials.

If an issuer reaches the target offering amount prior to the deadline identified in its offering materials pursuant to § 227.201(g), the issuer may close the offering on a date earlier than the deadline identified in its offering materials pursuant to § 227.201(g), provided that:

  1. The offering remains open for a minimum of 21 days pursuant to § 227.303(a);
  2. The Firm will notify to any potential investors, and gives or sends notice to investors that have made investment commitments in the offering, of:
    1. The new, anticipated deadline of the offering;
    2. The right of investors to cancel investment commitments for any reason until 48 hours prior to the new offering deadline; and
    3. Whether the issuer will continue to accept investment commitments during the 48- hour period prior to the new offering deadline.
  3. The new offering deadline is scheduled for and occurs at least five business days after the notice required in paragraph (2) of this section is provided; and
  4. At the time of the new offering deadline, the issuer continues to meet or exceed the target offering amount.
Cancellations and reconfirmations based on material changes
  1. If there is a material change to the terms of an offering or to the information provided by the issuer, the Firm will notify each investor who has made an investment commitment of the material change and that the investor’s investment commitment will be cancelled unless the investor reconfirms his or her investment commitment within five business days of receipt of the notice. If the investor fails to reconfirm his or her investment within those five business days, the Firm within five (5) business days thereafter must:
    1. Give or send the investor a notification disclosing that the commitment was cancelled, the reason for the cancellation and the refund amount that the investor is expected to receive; and
    2. Direct the refund of investor funds.
  2. If material changes to the offering or to the information provided by the issuer regarding the offering occur within five business days of the maximum number of days that an offering is to remain open, the offering must be extended to allow for a period of five business days for the investor to reconfirm his or her investment.
Return of funds if offering is not completed

If an issuer does not complete an offering, the Firm will within five (5) business days:

  1. Give or send each investor a notification of the cancellation, disclosing the reason for the cancellation, and the refund amount that the investor is expected to receive;
  2. Direct the refund of investor funds; and
  3. Prevent investors from making investment commitments with respect to that offering on its platform.
Intermediary Compensation

Please note that the Firm may receive compensation from the issuer of securities. Such amounts will be disclosed on the Notice of Investment Commitment delivered to each investor.

Consent to Electronic Delivery

By your signature below, you are providing consent for the Firm (referred to herein as “we” or “us”) to provide required disclosures to you electronically. This consent for electronic delivery applies to all required disclosures regarding the investment account you have with us, and is effective until withdrawn by you. Agreeing to accept disclosures electronically means that once we present them to you, and, if required, you accept them, they will apply to you and your investment accounts with us. It also means that we may not mail you copies of disclosures that are provided electronically. Accordingly, you should print or otherwise retain a copy for your records of this disclosure and all other disclosures you receive electronically.

In order to open and maintain an account with Bioverge, you must consent to electronic delivery of all disclosures. If you do not want to consent to electronic delivery of documents, you will not be able to open or maintain an account with us.

We may, at our discretion, make electronic disclosures available to you via our website or by e-mail, and may choose to send paper copies of disclosures to you even though we made or could have made them available to you electronically.

You may withdraw your consent to electronic delivery, but doing so will not affect the legal effectiveness, validity, or enforceability of the electronic documents that were provided to you before your withdrawal became effective. If you withdraw consent for electronic delivery, your withdrawal may take up to ten (10) days for us to process and we will close your account with the Firm.

You can request that we send you a paper copy of any disclosure that was originally provided electronically (we may charge you a fee for providing some documents and we will send these to documents to you using the United States Postal Service), withdraw your consent to receive future documents electronically, or provide us with updated information about how we can contact you electronically by writing to us or by using a method that may be made available to you on this website. If your e-mail address changes, you must provide us with the new address before the change either by writing to us or by using a method that may be made available to you on this website.

You may address any inquiries or questions to Bioverge, by sending us an e-mail at info@bioverge.com.

In order to receive electronic disclosures, you will need a working connection to the Internet. Your browser must support the Secure Sockets Layer (SSL) protocol. SSL provides a secure channel to send and receive data over the Internet through HS encryption capabilities. Microsoft Internet Explorer® version 7 or higher and Mozilla Firefox® version 3 or higher support this feature. You will also need either a printer connected to your computer to print documents or sufficient hard drive space available to save the information.

We may change this disclosure by posting the revised version on our website. By signing this New Account Application (by clicking the “I Accept” box), you are confirming that you consent to electronic delivery of disclosures, that your system meets the requirements described above, that you are able to access disclosures presented on our website or via e-mail, and that you can either print or electronically store these disclosures.

IN WITNESS WHEREOF, the undersigned investor certifies to the truth and accuracy of the foregoing information supplied by investor, and acknowledges receipt of the foregoing Investor Disclosures and Educational Materials. Investor has read and understood the foregoing matters, and in the event investor has any questions about any of the foregoing matters, investor should contact Rick Gibb, the Firm’s Chief Compliance Officer, at (630) 569-9106.

Types of Securities Offered

The most common forms of securities an issuer can offer are equity or debt. The securities we offer include the following:

Common Stock: Conveys a portion of the ownership interest in the company to the holder of the security. Stockholders are usually entitled to receive dividends when and if declared, vote on corporate matters, and receive information about the company, including financial statements. This is the riskiest type of equity security since common stock is last in line to be paid if a company fails. You should read our discussion of the risks of early-stage investing here, and pay special attention to the fact that your investment will only make money if the investment succeeds, and to the risk of possible share value decrease resulting in the loss of some or all of invested capital. The Common Stock of companies appearing on this platform is generally illiquid, and should therefore be thought of as a long-term investment. Common stock issuers may decide to sell additional securities in the future, resulting in a dilution of prior investors’ interests in the issuer and a corresponding decrease in those investors’ limited voting rights with respect to the securities purchased.

Preferred Stock: Stock that has priority over common stock as to dividend payments and/or the distribution of the assets of the company. Preferred stock can have the characteristics of either common stock or debt securities. While preferred stock gets paid ahead of common stock, it will still only be repaid on liquidation if there is money left over after the company’s debts are paid. In certain circumstances (such as an initial public offering or a corporate takeover) the preferred stock might be convertible into common stock (the riskiest class of equity). You should review the terms of the preferred stock to know when that might happen. Preferred stock may decrease in value and investors may lose some or all of their investment.

Debt / Revenue Share: Securities in which the seller is obligated to repay the investor's original investment amount at maturity plus interest. Debt securities are essentially loans to the company and the major risks they bear are that there is no guarantee of interest payments and the possibility of issuer default. Revenue share security risks include no guarantee of investor returns due to possible insufficient issuer revenues and possible loss of principal invested.

Convertible Note: This form of investment is popular with technology startups because it allows investors to initially lend money to the company and later receive shares if new professional investors decide to invest. The sort of convertible note that is most often offered on Bioverge may limit the circumstances in which any part of the loan is repaid, and the note may only convert when specified events (such as a preferred stock offering of a specific amount) happens in the future. You will not know how much your investment is “worth” until that time, which may never happen. You should treat this sort of convertible note as having the same risks as common stock. There is no guarantee that investors will experience a return on their investment and that investors may lose some of all of their investment.

SAFE Agreement. Inspired by the Y Combinator Agreements, a SAFE grants an investor the right to purchase equity at a future date. The Crowd SAFE is designed for a startup raising under Regulation Crowdfunding. Unlike a convertible note, a SAFE is not a loan. As such, it does not accrue interest or have a maturity date. This makes things simpler and negates much of the need to amend the agreement in the future. For example, it helps startups not waste time extending maturity dates or revising interest rates, if a Series A financing takes longer than you first expect. It also better aligns with the intention of most equity investors, who never intended to be lenders. If no subsequent equity financing or similar liquidity event occurs, the Crowd SAFE will not convert and therefore will produce no return. There is no guarantee that investors will experience a return on their investment and that investors may lose some of all of their investment.

Investment Limits

You are restricted to investing a certain amount in any 12-month period depending on a combination of your net worth (less the value of your primary residence if you own a home) and your annual income.

Note: you don't have to make these calculations yourself! Your limit is automatically calculated when you register on our platform and confirmed prior to making an investment.

If either your annual income or your net worth is less than $107,000, you can invest up to the greater of either:

  • $2,200, or
  • 5% of the lesser of your annual income or net worth during any 12-month period.

If both your annual income and your net worth are equal to or more than $107,000 then you can invest:

  • up to 10% of your annual income, or
  • up to 10% of your net worth, whichever is lesser up to a maximum of $107,000 during any 12-month period.

Remember, this is your limit for all Title III investments, not just those with Bioverge! Here are a few examples, courtesy of an SEC Investor Bulletin:

Annual Income Net Worth Calculation 12-month Limit
$30,000 $105,000 greater of $2,200 or 5% of $30,000 ($1,500) $2,200
$150,000 $80,000 greater of $2,200 or 5% of $80,000 ($4,000) $4,000
$150,000 $107,000 10% of $107,000 ($10,000) $10,700
$200,000 $900,000 10% of $200,000 ($20,000) $20,000
$1.2 million $2 million 10% of $1.2 million ($120,000), subject to cap $107,000
Disclosure Requirements

Form C

Prior to launching a Title III equity crowdfunding campaign, the issuer is required to complete and submit a Form C to the SEC together with required attachments. Companies that file a Form C are required to disclose certain information to the public which can be used to understand an investment and that helps determine whether a particular investment is appropriate for a specific person.

This includes general information about the issuer, its officers and directors, a description of the business, the planned use for the money raised from the offering, often called the use of proceeds, the target offering amount, the deadline for the offering, related-party transactions, risks specific to the issuer or its business, and financial information about the issuer.

Annual Filing Obligation of Issuers

Each Issuer that successfully completes a Title III Regulation Crowdfunding securities offering is required to annually file with the SEC a Form C-AR and financial statements. This must be done no later than 120 days after the end of the Issuer’s fiscal year covered by such filing. Each Issuer must also post its Form C-AR and financial statements to its own website, and that link must be provided along with the date by which such report will be available on the issuer’s website.

The Form C-AR contains updated disclosure substantially similar to that provided in the Issuer’s initial Form C, including information on the Issuer’s size, location, principals and employees, business, plan of operations and the risks of investment in the Issuer’s securities; however, offering-specific disclosure is not required to be disclosed in the Form C-AR.

Investors should be aware that an Issuer may no longer be required to continue its annual reporting obligations under any of the following circumstances:

  • The issuer is required to fle reports under Section 13(a) or Section 15(d) of the Exchange Act;
  • The issuer has fled at least one annual report pursuant to Regulation Crowdfunding and has fewer than 300 holders of record and has total assets that do not exceed $10,000,000;
  • The issuer has fled at least three annual reports pursuant to Regulation Crowdfunding;
  • The issuer or another party repurchases all of the securities issued in reliance on Section 4(a) (6) of the Securities Act, including any payment in full of debt securities or any complete redemption of redeemable securities; or The issuer liquidates or dissolves its business in accordance with state law.

In the event that an Issuer ceases to make annual flings, investors may no longer have current financial information about the Issuer available to them.