- $2.1 million in bookings YTD with $20 million pipeline
- Founder & CEO Bill Gross is a highly successful serial entrepreneur
- Advisors and Investors include Idealab, Carl Sheldon (former CEO of TAQA a $5B Utility Company), and Steven Dietz (Co-Founder of UpFront Ventures)
- Rights to 15 filed and 10 granted patents on Solar capture and conversion technologies
- $10 million, 10-year licensing agreement in place with a company in China
- Amount raised:
- Series C :
- Minimum Investment: US $500 per investor
- : Preferred Equity
- US $20,000,113 :
- Side by Side Offering
The world’s energy needs are skyrocketing, and experts project that global demand will only continue to rise. Where will all this energy come from?
At Edisun Microgrids, we believe solar can be a major source of the world’s energy because every day the sun provides more than 10,000 times the energy the world needs. The key is making solar cost-effective and available on-demand. Edisun's solutions address these hurdles and through them, we are aiming to drive down the cost of solar energy to make clean power more affordable than fossil fuels.
Our technology is a new solar tracking system named PV Booster™ that points solar panels directly at the sun all day long. By enabling the panels to continuously face the sun, PV Booster increases clean energy production by 30% and improves the economics of solar by 20%. We designed PV Booster to meet the unique needs of the underserved Commercial and Industrial (C&I) rooftop solar market – a trillion dollar opportunity in the US alone.
Our sun-tracking technology also allows us to concentrate sunlight which produces high-temperature solar energy. Then, with our proprietary energy storage technology, we can make solar-generated electricity available 24 hours a day. This means that, for the first time ever, we will produce on-demand solar electricity at a price lower than fossil fuels.
Edisun has already received over $1.1million in PV Booster orders and will be powering the largest rooftop tracker installation in the world. We’ve also signed a $10 million, 10-year licensing agreement with a company in China for our proprietary technologies.
Our goal is to drive down the cost of solar energy to make it more affordable than fossil fuels so it won’t require any subsidies, it won’t require any grants, it won’t require any laws, it will just happen because it’s actually more cost-effective.
We are now scaling globally and are very excited to find partners, distributors, and investors to help us take these new capabilities to the whole planet.
Tune in to hear from Bill Gross, CEO of Edisun Microgrids as he presents on Wednesday, December 6th at 4:00pm ET.
Registration URL: https://attendee.gotowebinar.com/register/6678329560593921281
PV Booster is a rooftop solar tracking system built specifically for the commercial and industrial (C&I) solar sector. By enabling modules to continuously face the sun, PV Booster increases energy capture of the modules by 30%, improving project economics by 20% over standard fixed-tilt installations.
Many commercial and industrial building owners are interested in going solar, but can’t make the economics pencil out. Using PV Booster dramatically boosts financial returns and makes solar economically viable at sites where projects were not previously feasible.
Edisun’s proprietary design and control algorithms for PV Booster overcomes the challenges that have historically prevented rooftop trackers from being installed, like weight, size, mounting points, and wind resistance.
PV Booster is manufactured to order, and includes the roof attachments, tracking structure, pre-fabricated wiring and grounding, electrical control units, project engineering drawings, and a full product diligence package to assist any customer in the estimating and permitting process. Once projects are installed and operational, Edisun’s relationship with customers continues through our customer service program.
PV Booster’s long-term opportunity is to accelerate adoption of solar around the world. This technology is part of Edisun Microgrid’s mission to drive down the cost of solar energy to make clean power more affordable than fossil fuels.
Tune in to hear from Bill Gross, CEO of Edisun Microgrids as he presents on Wednesday, December 6th at 4:00pm ET.
Registration URL: https://attendee.gotowebinar.com/register/6678329560593921281
Bill Gross, our CEO and the founder of Edisun, has been interested in solar power since he was a teenager. His first business at age 15 was selling plans for solar-powered water heaters and ovens out of the back pages of Popular Science. Fast forward 150+ companies and 45 successful IPO’s and acquisitions later when Bill, again, took a new look at the business opportunity afforded by solar energy. With new ideas and a fresh perspective, Bill founded Edisun with the goal of making solar power more affordable than fossil fuels.
A Side by Side offering refers to a deal that is raising capital under two offering types. If you plan on investing less than US $20,000.00, you will automatically invest under the Regulation CF offering type. If you invest more than US $20,000.00, you must be an accredited investor and invest under the Regulation D offering type.
|Terms & Description|
|Investor Types||Accredited Only||Accredited and Non-accredited|
|Series C||Series C|
|Round size||US $3,000,000||US $3,000,000|
|US $814,460||US $1,081,101|
|Minimum investment||$20,000||US $500|
|US $1,000,000||US $1,000,000|
|Security Type||Preferred Equity||Preferred Equity|
|US $20,000,113||US $20,000,113|
|1x; Pari Passu||1x; Pari Passu|
|CF Offering Cap||While Edisun Microgrids is offering up to $3,000,000 worth of securities in its Series C Round, only up to $1,070,000 of that amount may be raised through Regulation CF.||While Edisun Microgrids is offering up to $3,000,000 worth of securities in its Series C Round, only up to $1,070,000 of that amount may be raised through Regulation CF.|
|Investment Management Agreement||All non-Major Purchasers will be subject to an Investment Management Agreement (“IMA”). The IMA will authorize an investment Manager to act as representative for each non-Major Purchaser and take certain actions for their benefit and on their behalf. Please see a copy of the IMA included with Edisun Microgrids's offering materials for additional details.||All non-Major Purchasers will be subject to an Investment Management Agreement (“IMA”). The IMA will authorize an investment Manager to act as representative for each non-Major Purchaser and take certain actions for their benefit and on their behalf. Please see a copy of the IMA included with Edisun Microgrids's offering materials for additional details.|
|Closing Terms||The Company is making concurrent offerings under both Regulation CF and Regulation D (the "Combined Offerings"). Unless the Company raises at least the Target Amount of $25,000 under the Regulation CF offering and a total of 1,000,000 under the Combined Offerings (the “Closing Amount”) by December 15th, 2017, no securities will be sold in this offering, investment commitments will be cancelled, and committed funds will be returned.||The Company is making concurrent offerings under both Regulation CF and Regulation D (the "Combined Offerings"). Unless the Company raises at least the Target Amount of $25,000 under the Regulation CF offering and a total of 1,000,000 under the Combined Offerings (the “Closing Amount”) by December 15th, 2017, no securities will be sold in this offering, investment commitments will be cancelled, and committed funds will be returned.|
The graph below illustrates theor the of Edisun Microgrids's prior rounds by year.
Edisun Microgrids, Inc. (formerly Edisun Heliostats, Inc.)(“Edisun” or the “Company”) is a Delaware corporation that was formed on April 9, 2013. The Company has been researching, testing and developing technology to capture and store solar energy and convert that to usable electricity.
At December 31, 2016, Idealab Holdings, LLC owns a special share of voting stock which gives it the right to vote 80% of the outstanding voting securities of the Company (see Exhibit B Note 5 - Capitalization). Idealab Holdings, LLC is a wholly owned subsidiary of Idealab, a creator and operator of technology businesses.
The Company has incurred recurring losses and negative cash flows from operating activities since inception, and has an accumulated deficit of $6,807,386 at December 31, 2016. To date, the Company has been dependent on equity and debt financings to fund its operations. The Company has commenced principal operations in early 2017 as its first product offering became commercially available and is generating revenue for the Company. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company’s ability to continue as a going concern in the twelve months following the date of issuance of these financial statements is dependent upon its ability to generate revenues and/or obtain financing sufficient to meet current and future obligations until such time that it can produce profitable operating results. Management plans to grow the Company’s revenue base, expand its product offerings and raise additional financing to fund operations. The Company does not know whether it will be able to raise additional financing or financing on terms favorable to the Company or if it will ultimately achieve profitability on a stand-alone basis.
Grant income totaled $75,000 in 2015 compared with $52,024 in 2016. Grant income for both years was derived exclusively from a federal research and development grant related to energy storage technologies. This grant concluded in 2017. In 2017 the Company sold its first project related to PV Booster, the project is expected to be completed in Q4 2017.
In 2015 and 2016, the Company did not have cost of sales related to grant income as the grant was for partial reimbursement of certain research and development costs which are included in operating expenses.
Operating expenses totaled $1,556,701 in 2015 and $3,443,284 in 2016, an increase of $1,886,583 or 121%. The primary components of this increase were:
- An increase in sales and marketing expense from $7,904 in 2015 to $413,109, in 2016, an increase of $405,205 or 5127%. 2015 marketing expenses were extremely low as the Company was mainly just an R&D organization. In 2016 the Company hired employees dedicated to S&M and also launched the PV Booster product publicly which accounted for the large increase in expense.
- An increase in research and development expense from $1,041,420 in 2015 to $2,315,861 in 2016, an increase of $1,274,441 or 122%. The increase was due primarily to additional employees and consultants working on the design and testing of various solar energy collection and storage devices.
- An increase in general and administrative expense from $507,377 in 2015 to $714,314 in 2016, an increase of $206,937 or 41%. The increase was due primarily to additional employees and consultants working on fundraising and various product roadmaps.
Our net loss totaled $1,525,648 in 2015 compared with a net loss totaling $3,393,590 in 2016. Our increase in net loss was primarily driven by our increase in operating expenses.
Although Edisun Microgrids is not currently profitable, we believe we may reach profitability within two years based on increased customer awareness, and improved margins on our PV Booster product. There is no guarantee that we will be able to achieve profitability or that our current calculations of our future costs will prove to be accurate.
The Company’s industry is competitive and characterized by ongoing technological advances. The Company is subject to risks common to companies in the technology industry including, but not limited to, development of new technological innovations by the Company or its competitors and the protection of proprietary technologies.
Liquidity and Capital Resources
We plan to use the proceeds as set forth above under "use of proceeds", which is an indispensable element of our business strategy.
As of December 31, 2016, the Company had $231,027 of cash and cash equivalents. As more fully described in the subsequent events footnotes in the reviewed financial statements, notable cash transactions through September 2017 include:
- Completion of a follow-on closing of the Company’s Series B financing round, bringing in net new proceeds of $1,500,000.
- Entering into a technology license agreement with a third party, resulting in an upfront cash payment to Edisun of $1,000,000. This prepaid royalty is expected to be fully earned and converted to revenue by Q3 2018.
- Collecting $781,000 in advance payments from the Company’s initial PV Booster customer. These advanced payments will convert to revenue upon substantial completing of the project which is expected in Q4 2017.
In order for the company to achieve its proposed business plan the proceeds of this offering or other resources are necessary.
Capital Expenditures and Other Obligations
The Company does intend to make material capital expenditures in the future to further develop its products. In addition, the company is obligated, under its supply agreement with Cool Energy, Inc. to make material license payments in the future.
Note: These are selected portions of the Financial Information section in the Form C Offering Memorandum. The Offering Memorandum can be found in the Form C section.
The market for solar technologies, products, and services is driven by the strong demand for clean and distributed energy. In the US alone total installed solar capacity is expected to nearly triple over the next five years.
Risks Related to the Company’s Business and Industry
We have generated substantial net losses and negative operating cash flows since our inception as part of the development of our business. We have generated substantial net losses and negative cash flows from operating activities since we commenced operations. We have incurred losses of approximately $6.8 million from our inception through December 31, 2016. For the year ended December 31, 2016, we incurred a net loss of $3.9 million. Before achieving profitability we will generate continued losses. Our costs may also increase due to such factors as higher than anticipated financing and other costs; non-performance by third-party suppliers, licensees, partners or subcontractors; and increases in the costs of labor or materials. If any of these or similar factors occur, our net losses and accumulated deficit could increase significantly and the value of our stock could decline.
Our proprietary technology has a limited history and may perform below expectations. We use proprietary technology that has not been previously implemented on customer projects, and we may experience technological problems that we are unable to foresee. If the implementation of our proprietary technology is unsuccessful, it could negatively impact the successful operation of projects using our systems and may result in additional payments, deductions or defaults under our agreements. In addition, there is a lack of long-term reliability data for our proprietary system. Actual long-term performance of these projects, may fall short of expectations. Our equipment may be susceptible to damage from weather-related or other unforeseen events. Equipment performance issues could result in significant operational problems for our Company, including increased maintenance costs, decreased revenue, warranty claims, inability to meet delivery requirements or defaults under our agreements.
We depend on third-party suppliers for the supply of materials and components for our products. For example, the Company depends on Cool Energy, Inc. for its supply of heat engines. Cool Energy or our other suppliers may experience product development, resource and funding constraints that could impact their ability to supply components in a timely manner, if at all. Any of these suppliers could stop producing our components or supplying our raw materials, cease operations or be acquired by, or enter into exclusive arrangements with, one or more of our competitors. As a result, these suppliers could stop selling to us at commercially reasonable prices, or at all. Transitioning to a new supplier or redesigning a product to accommodate a new component manufacturer would result in additional costs and delays. These outcomes could harm our business or financial performance. Any interruption in the supply of limited source components or raw materials for our products would adversely affect our ability to meet scheduled product deliveries to our customers, could result in lost revenue or higher expenses and would harm our business.
In order for the Company to compete and grow, it must attract, recruit, retain and develop the necessary personnel who have the needed experience. Recruiting and retaining highly qualified personnel is critical to our success. These demands may require us to hire additional personnel and will require our existing management personnel to develop additional expertise. We face intense competition for personnel. The failure to attract and retain personnel or to develop such expertise could delay or halt the development and commercialization of our product candidates. If we experience difficulties in hiring and retaining personnel in key positions, we could suffer from delays in product development, loss of customers and sales and diversion of management resources, which could adversely affect operating results. Our consultants and advisors may be employed by third parties and may have commitments under consulting or advisory contracts with third parties that may limit their availability to us.
Edisun faces competition from other companies in the solar energy space. Existing companies that engage in the tracker and energy generation business or are within the broader solar space could introduce new or enhance existing products. If the Company is able to establish a market around its product, it may find that larger, better funded companies may enter the market, which could negatively impact Edisun’s growth.
Edisun’s success is dependent on market adoption of solar energy. The market for solar energy adoption is still nascent. Fluctuations in the price of other fossil fuel and other alternative energy resources, the introduction of new energy technologies, and a shifting regulatory environment could negatively impact the Company’s ability to generate revenue.
Our operations depend in part on the success of our strategic relationships with third parties. A key component of our strategy is to develop or expand our strategic relationships with third parties. For example, we have entered into a 10-year licensing agreement with a company in China for our proprietary technologies. Identifying partners and negotiating relationships with them requires significant time and resources. If we are unsuccessful in establishing or maintaining our relationships with these third parties, our ability to operate our business could be impaired. Even if we are able to establish these relationships, we may not be able to execute on our goal of leveraging these relationships to meaningfully benefit our business and expand our customer base. Any of these third parties we work with could also face their own funding challenges or operational constraints and could cease operations. This would limit our potential and our opportunities to generate revenue or cash receipts.
We plan to operate in China and other parts of the world. Our operations are subject to the effects of global competition and geopolitical risks. They are also affected by local economic environments, including inflation, recession, currency volatility and actual or anticipated default on sovereign debt. Political changes, some of which may be disruptive, can interfere with our supply chain, our customers and all of our activities in a particular location. While some of these global economic and political risks can be hedged using derivatives or other financial instruments and some are insurable, such attempts to mitigate these risks are costly and not always successful, and our ability to engage in such mitigation may decrease or become even more costly as a result of more volatile market conditions. Doing business in foreign markets requires us to be able to respond to rapid changes in market, legal, and political conditions in these countries. The success of our business will depend, in part, on our ability to succeed in differing legal, regulatory, economic, social and political environments. We may not be able to develop and implement policies and strategies that will be effective in each location where we do business.
Our global operations are required to comply with the U.S. Foreign Corrupt Practices Act and similar anti-bribery laws in other jurisdictions and with U.S. and foreign export control, trade embargo and customs laws. If we fail to comply with them, we could suffer civil and criminal sanctions.
Our international operations could be affected by currency fluctuations, capital and exchange controls, expropriation and other restrictive government actions, changes in intellectual property legal protections and remedies, trade regulations and procedures and actions affecting approval, production, pricing, and marketing of, reimbursement for and access to our products, as well as by political unrest, unstable governments and legal systems and inter-governmental disputes. Any of these changes could adversely affect our business. Many emerging markets have experienced growth rates in excess of the world’s largest markets, leading to an increased contribution to the industry’s global performance. There is no assurance that these countries will continue to sustain these growth rates.
The Company’s success depends on the experience and skill of the board of directors, its executive officers and key employees. In particular, we are reliant upon our CEO, Bill Gross, to provide leadership to the company. However, he is involved with other startups and endeavors. By dividing his attention, he may not be able to devote the necessary time to Edisun for the Company to hit its projections and grow at its optimal rate. We are also reliant upon our engineering team to support our current products as well as develop new ones.
We rely on various intellectual property rights, including patents, trademarks, and licenses in order to operate our business. Such intellectual property rights, however, may not be sufficiently broad or otherwise may not provide us a significant competitive advantage. In addition, the steps that we have taken to maintain and protect our intellectual property may not prevent it from being challenged, invalidated, circumvented or designed-around, particularly in countries where intellectual property rights are not highly developed or protected. In some circumstances, enforcement may not be available to us because an infringer has a dominant intellectual property position or for other business reasons, or countries may require compulsory licensing of our intellectual property. Our failure to obtain or maintain intellectual property rights that convey competitive advantage, adequately protect our intellectual property or detect or prevent circumvention or unauthorized use of such property, could adversely impact our competitive position and results of operations. We also rely on nondisclosure and noncompetition agreements with employees, consultants and other parties to protect, in part, trade secrets and other proprietary rights. There can be no assurance that these agreements will adequately protect our trade secrets and other proprietary rights and will not be breached, that we will have adequate remedies for any breach, that others will not independently develop substantially equivalent proprietary information or that third parties will not otherwise gain access to our trade secrets or other proprietary rights.
As we expand our business, protecting our intellectual property will become increasingly important. The protective steps we have taken may be inadequate to deter our competitors from using our proprietary information. In order to protect or enforce our patent rights, we may be required to initiate litigation against third parties, such as infringement lawsuits. Also, these third parties may assert claims against us with or without provocation. These lawsuits could be expensive, take significant time and could divert management’s attention from other business concerns. The law relating to the scope and validity of claims in the technology field in which we operate is still evolving and, consequently, intellectual property positions in our industry are generally uncertain. We cannot assure you that we will prevail in any of these potential suits or that the damages or other remedies awarded, if any, would be commercially valuable.
Edisun’s business model is capital intensive. The amount of capital the Company is attempting to raise in this Offering is not enough to sustain the Company’s current business plan. In order to achieve the Company’s near and long-term goals, the Company will need to procure funds in addition to the amount raised in the Offering. There is no guarantee the Company will be able to raise such funds on acceptable terms or at all. If we are not able to raise sufficient capital in the future, we will not be able to execute our business plan, our continued operations will be in jeopardy and we may be forced to cease operations and sell or otherwise transfer all or substantially all of our remaining assets, which could cause a Purchaser to lose all or a portion of his or her investment.
We are subject to income taxes as well as non-income based taxes, such as payroll, sales, use, value-added, net worth, property and goods and services taxes, in both the U.S. and China. Significant judgment is required in determining our provision for income taxes and other tax liabilities. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. Although we believe that our tax estimates are reasonable: (i) there is no assurance that the final determination of tax audits or tax disputes will not be different from what is reflected in our income tax provisions, expense amounts for non-income based taxes and accruals and (ii) any material differences could have an adverse effect on our financial position and results of operations in the period or periods for which determination is made.
We are not subject to Sarbanes-Oxley regulations and lack the financial controls and safeguards required of public companies. We do not have the internal infrastructure necessary, and are not required, to complete an attestation about our financial controls that would be required under Section 404 of the Sarbanes-Oxley Act of 2002. There can be no assurance that there are no significant deficiencies or material weaknesses in the quality of our financial controls. We expect to incur additional expenses and diversion of management’s time if and when it becomes necessary to perform the system and process evaluation, testing and remediation required in order to comply with the management certification and auditor attestation requirements.
The Company has outstanding liabilities. The Company owes (i) a software vendor $54,561 in remaining payments due on an annual software license and (ii) Idealab approximately $150K in outstanding invoices for services and rental of office space and (iii) Idealab $250K in outstanding notes secured by accounts receivable.
We may be required to secure additional loans or bridge funding. We experience a mismatch between the timing of our cash collections and payables. This mismatch must be financed through indebtedness or equity capital. Our financing needs may also increase due to unanticipated cost increases due to such factors as increases in the quantity or costs of labor or materials. As a result of these and other factors we may be required to secure a loan or equity bridge funding to meet our commitments.
The Company’s financial statements include a “going concern” note. The Company has incurred recurring losses and negative cash flows from operating activities since inception, and has an accumulated deficit of $6,807,386 at December 31, 2016. To date, the Company has been dependent on equity and debt financings to fund its operations. The Company’s ability to continue as a going concern in the twelve months following the date of issuance of these financial statements is dependent upon its ability to generate revenues and/or obtain financing sufficient to meet current and future obligations until such time that it can produce profitable operating results. Management plans to grow the Company’s revenue base, expand its product offerings and raise additional financing to fund operations. The Company does not know whether it will be able to raise additional financing or financing on terms favorable to the Company or if it will ultimately achieve profitability on a stand-alone basis. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time.
Risks Related to the Securities
Existing investors have not waived their pre-emptive rights and may exercise those rights. The pre-emptive right entitles those investors to participate in this securities issuance on a pro rata basis. If those investors choose to exercise their pre-emptive right, it could dilute shareholders in this round. This dilution could reduce the economic value of the investment, the relative ownership resulting from the investment, or both.
You will be bound by an Investment Management Agreement, which limits your voting rights. All Non-Major Purchasers of Series C Preferred Stock will be bound by an Investment Management Agreement. This agreement will limit your voting rights and at a later time may require you to convert your future preferred shares into common shares without your consent. Non-Major Purchasers will be bound by this agreement, unless Non-Major Purchasers holding a majority of the principal amount outstanding of the Series C Preferred Stock vote to terminate the agreement.
You will receive pari passu liquidation preference. In the event of our liquidation, dissolution, or winding up, holders of our Preferred Stock will be entitled to receive the greater of the original issue price, plus any dividends declared but unpaid or such amounts that they would have received had all shares of preferred shares been converted to common shares. Holders of each series of Preferred Stock receive these distributions on a pari passu basis with holders of other series of Preferred Stock and before any holders of Common Stock.
The Series C Preferred Stock will not be freely tradable until one year from the initial purchase date. Although the Series C Preferred Stock may be tradable under federal securities law, state securities regulations may apply and each Purchaser should consult with his or her attorney. You should be aware of the long-term nature of this investment. There is not now and likely will not be a public market for the Series C Preferred Stock. Because the Series C Preferred Stock have not been registered under the Securities Act or under the securities laws of any state or non-United States jurisdiction, the Series C Preferred Stock have transfer restrictions and cannot be resold in the United States except pursuant to Rule 501 of Regulation CF. It is not currently contemplated that registration under the Securities Act or other securities laws will be affected. Limitations on the transfer of the Series C Preferred Stock may also adversely affect the price that you might be able to obtain for the Series C Preferred Stock in a private sale. Purchasers should be aware of the long-term nature of their investment in the Company. Each Purchaser in this Offering will be required to represent that it is purchasing the Securities for its own account, for investment purposes and not with a view to resale or distribution thereof.
Your ownership of the shares of Series C Preferred Stock will be subject to dilution. Owners of Series C Preferred Stock in this Offering do not have preemptive rights. If the Company conducts subsequent Offerings of preferred stock or Securities convertible into preferred stock, issues shares pursuant to a compensation or distribution reinvestment plan or otherwise issues additional shares, investors who purchase shares in this Offering who do not participate in those other stock issuances will experience dilution in their percentage ownership of the Company’s outstanding shares. Furthermore, shareholders may experience a dilution in the value of their shares depending on the terms and pricing of any future share issuances (including the shares being sold in this Offering) and the value of the Company’s assets at the time of issuance.
The Securities will be equity interests in the Company and will not constitute indebtedness. The Securities will rank junior to all existing and future indebtedness and other non-equity claims on the Company with respect to assets available to satisfy claims on the Company, including in a liquidation of the Company. Additionally, unlike indebtedness, for which principal and interest would customarily be payable on specified due dates, there will be no specified payments of dividends with respect to the Securities and dividends are payable only if, when and as authorized and declared by the Company and depend on, among other matters, the Company’s historical and projected results of operations, liquidity, cash flows, capital levels, financial condition, debt service requirements and other cash needs, financing covenants, applicable state law, federal and state regulatory prohibitions and other restrictions and any other factors the Company’s board of directors deems relevant at the time. In addition, the terms of the Securities will not limit the amount of debt or other obligations the Company may incur in the future. Accordingly, the Company may incur substantial amounts of additional debt and other obligations that will rank senior to the Securities.
There can be no assurance that we will ever provide liquidity to Purchasers through either a sale of the Company or a registration of the Securities. There can be no assurance that any form of merger, combination, or sale of the Company will take place, or that any merger, combination, or sale would provide liquidity for Purchasers. Furthermore, we may be unable to register the Securities for resale by Purchasers for legal, commercial, regulatory, market-related or other reasons. In the event that we are unable to effect a registration, Purchasers could be unable to sell their Securities unless an exemption from registration is available.
The Company does not anticipate paying any cash dividends for the foreseeable future. The Company currently intends to retain future earnings, if any, for the foreseeable future, to repay indebtedness and to support its business. The Company does not intend in the foreseeable future to pay any dividends to holders of its shares of preferred stock.
Any valuation at this stage is difficult to assess. Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult to assess and you may risk overpaying for your investment. In addition, there may be additional classes of equity with rights that are superior to the class of equity being sold.
Start-up investing is risky. Investing in startups is very risky, highly speculative, and should not be made by anyone who cannot afford to lose their entire investment. Unlike an investment in a mature business where there is a track record of revenue and income, the success of a startup or early-stage venture often relies on the development of a new product or service that may or may not find a market. Before investing, you should carefully consider the specific risks and disclosures related to both this offering type and the company which can be found in this company profile and the documents in the data room below.
Your shares are not easily transferable. You should not plan on being able to readily transfer and/or resell your security. Currently there is no market or liquidity for these shares and the company does not have any plans to list these shares on an exchange or other secondary market. At some point the company may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when the company either lists their shares on an exchange, is acquired, or goes bankrupt.
The Company may not pay dividends for the foreseeable future. Unless otherwise specified in the offering documents and subject to state law, you are not entitled to receive any dividends on your interest in the Company. Accordingly, any potential investor who anticipates the need for current dividends or income from an investment should not purchase any of the securities offered on the Site.
Valuation and capitalization. Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult to assess and you may risk overpaying for your investment. In addition, there may be additional classes of equity with rights that are superior to the class of equity being sold.
You may only receive limited disclosure. While the company must disclose certain information, since the company is at an early-stage they may only be able to provide limited information about its business plan and operations because it does not have fully developed operations or a long history. The company may also only obligated to file information periodically regarding its business, including financial statements. A publicly listed company, in contrast, is required to file annual and quarterly reports and promptly disclose certain events — through continuing disclosure that you can use to evaluate the status of your investment.
Investment in personnel. An early-stage investment is also an investment in the entrepreneur or management of the company. Being able to execute on the business plan is often an important factor in whether the business is viable and successful. You should be aware that a portion of your investment may fund the compensation of the company’s employees, including its management. You should carefully review any disclosure regarding the company’s use of proceeds.
Possibility of fraud. In light of the relative ease with which early-stage companies can raise funds, it may be the case that certain opportunities turn out to be money-losing fraudulent schemes. As with other investments, there is no guarantee that investments will be immune from fraud.
Lack of professional guidance. Many successful companies partially attribute their early success to the guidance of professional early-stage investors (e.g., angel investors and venture capital firms). These investors often negotiate for seats on the company’s board of directors and play an important role through their resources, contacts and experience in assisting early-stage companies in executing on their business plans. An early-stage company may not have the benefit of such professional investors.
Frequently Asked Questions
A Side by Side offering refers to a deal that is raising capital under two offering types. This Side by Side offering is raising under Regulation CF and Rule 506(c) of Regulation D.
The Form C is a document the company must file with the Securities and Exchange Commission (“SEC”) which includes basic information about the company and its offering and is a condition to making a Reg CF offering available to investors. It is important to note that the SEC does not review the Form C, and therefore is not recommending and/or approving any of the securities being offered.
Before making any investment decision, it is highly recommended that prospective investors review the Form C filed with the SEC (included in the company's profile) before making any investment decision.
Rule 506(c) under Regulation D is a type of offering with no limits on how much a company may raise. The company may generally solicit their offering, but the company must verify each investor’s status as an accredited investor prior to closing and accepting funds. To learn more about Rule 506(c) under Regulation D and other offering types check out our blog and academy.
Title III of the JOBS Act outlines Reg CF, a type of offering allowing private companies to raise up to $1 million from all Americans. Prior capital raising options limited private companies to raising money only from accredited investors, historically the wealthiest ~2% of Americans. Like a Kickstarter campaign, Reg CF allows companies to raise funds online from their early adopters and the crowd. However, instead of providing investors a reward such as a t-shirt or a card, investors receive shares, typically equity, in the startups they back. To learn more about Reg CF and other offering types check out our blog and academy.
When you complete your investment on SeedInvest, your money will be transferred to an escrow account where an independent escrow agent will watch over your investment until it is accepted by Edisun Microgrids. Once Edisun Microgrids accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to Edisun Microgrids in exchange for your shares. At that point, you will be a proud owner in Edisun Microgrids.
To make an investment, you will need the following information readily available:
- Personal information such as your current address and phone number
- Employment and employer information
- Net worth and income information
- Social Security Number or government-issued identification
- ABA bank routing number and checking account number (typically found on a personal check or bank statement)
If you are investing under Rule 506(c) of Regulation D, your status as an Accredited Investor will also need to be verified and you will be asked to provide documentation supporting your income, net worth, revenue, or net assets or a letter from a qualified advisor such as a Registered Investment Advisor, Registered Broker Dealer, Lawyer, or CPA.
An investor is limited in the amount that he or she may invest in a Reg CF offering during any 12-month period:
- If either the annual income or the net worth of the investor is less than $100,000, the investor is limited to the greater of $2,000 or 5% of the lesser of his or her annual income or net worth.
- If the annual income and net worth of the investor are both greater than $100,000, the investor is limited to 10% of the lesser of his or her annual income or net worth, to a maximum of $100,000.
Separately, Edisun Microgrids has set a minimum investment amount of US $500.
Accredited investors investing $20,000 or over do not have investment limits.
You are a partial owner of the company, you do own shares after all! But more importantly, companies which have raised money via Regulation CF must file information with the SEC and post it on their websites on an annual basis. Receiving regular company updates is important to keep shareholders educated and informed about the progress of the company and their investment. This annual report includes information similar to a company’s initial Reg CF filing and key information that a company will want to share with its investors to foster a dynamic and healthy relationship.
In certain circumstances a company may terminate its ongoing reporting requirement if:
- The company becomes a fully-reporting registrant with the SEC
- The company has filed at least one annual report, but has no more than 300 shareholders of record
- The company has filed at least three annual reports, and has no more than $10 million in assets
- The company or another party purchases or repurchases all the securities sold in reliance on Section 4(a)(6)
- The company ceases to do business
However, regardless of whether a company has terminated its ongoing reporting requirement per SEC rules, SeedInvest works with all companies on its platform to ensure that investors are provided quarterly updates. These quarterly reports will include information such as: (i) quarterly net sales, (ii) quarterly change in cash and cash on hand, (iii) material updates on the business, (iv) fundraising updates (any plans for next round, current round status, etc.), and (v) any notable press and news.
Currently there is no market or liquidity for these shares. Right now Edisun Microgrids does not plan to list these shares on a national exchange or another secondary market. At some point Edisun Microgrids may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when Edisun Microgrids either lists their shares on an exchange, is acquired, or goes bankrupt.
You can return to SeedInvest at any time to view your portfolio of investments and obtain a summary statement. If invested under Regulation CF you may also receive periodic updates from the company about their business, in addition to monthly account statements.
This is Edisun Microgrids's fundraising profile page, where you can find information that may be helpful for you to make an investment decision in their company. The information on this page includes the company overview, team bios, and the risks and disclosures related to this investment opportunity. If the company runs a side by side offering that includes an offering under Regulation CF, you may also find a copy of the Edisun Microgrids's Form C. The Form C includes important details about Edisun Microgrids's fundraise that you should review before investing.
For offerings made under Regulation CF, you may cancel your investment at any time up to 48 hours before a closing occurs or an earlier date set by the company. You will be sent a reminder notification approximately five days before the closing or set date giving you an opportunity to cancel your investment if you had not already done so. Once a closing occurs, and if you have not canceled your investment, you will receive an email notifying you that your shares have been issued. If you have already funded your investment, your funds will be promptly refunded to you upon cancellation. To cancel your investment, you may go to your portfolio page
If you invest under any other offering type, you may cancel your investment at any time, for any reason until a closing occurs. You will receive an email when the closing occurs and your shares have been issued. If you have already funded your investment and your funds are in escrow, your funds will be promptly refunded to you upon cancellation. To cancel your investment, please go to your portfolio page.