REG. BI DISCLOSURE

StartEngine Primary, LLC

Regulation Best Interest Disclosure Statement

StartEngine Primary LLC encourages you to carefully review the information contained within this Regulation Best Interest Disclosure Statement, along with any applicable account agreement(s) and documentation that you may receive from us or that is contained on our website. The Regulation Best Interest Disclosure Statement highlights important information concerning the scope and terms of the services we offer, including details regarding the potential conflicts of interest that may arise through our services.

Overview

The Regulation Best Interest (“Reg BI”) disclosure statement is provided to inform you, our retail customers, about the services we offer and our relationship with you. Reg BI establishes a standard of conduct for broker-dealers and their associated persons when making a recommendation of any securities transaction or investment strategy involving securities to a retail customer. StartEngine Primary LLC (“SE Primary” or “We”) is providing this Reg BI Disclosure Statement as required under the U.S. Securities and Exchange Commission (“SEC”). This Disclosure Statement provides information about material facts relating to the scope and terms of our brokerage relationship for your StartEngine brokerage account.

What Investment Services does StartEngine Primary LLC provide?

We offer agency brokerage services, including executing transactions in Regulation A+ (“Reg A+”). Regulation Crowdfunding (“Reg CF”), and Regulation D 506(c) (“Reg D”) offerings, to issuers we represent. The investments available to you are shares offered under Reg A+, Reg CF, and Reg D. SE Primary facilitates these offerings of investments to retail investors through our online platform (StartEngine.com). It is important to note that in certain instances, the issuers of such shares are our affiliates.

Investing in these offerings involves significant risks, which you must understand fully. All investments carry risk, including the possibility of losing your entire principal. Private placements and equity crowdfunding are particularly high-risk investments. While these investments may offer the potential for higher returns, they also carry the real possibility of greater losses, including the risk of losing your entire investment. You should only consider these higher-risk investments if your risk tolerance (the level of risk or loss you are willing and able to accept to achieve your investment goals) is high. We encourage you to carefully evaluate your investment objectives and risk tolerance before making any investments.

Please note the following, important limitations of our offerings:

• Illiquidity: These investments are not easily sold or exchanged for cash.
• Speculative Nature: These offerings carry a high level of risk and uncertainty.
• High Risk: The potential for loss is significant, and they may not be suitable for all investors.
• Minimum Investment Requirements: The required minimum investment amount may be substantial.

• Securities you own or wish to buy may not be eligible for the ATS;
• Buyers and sellers determine whether there is liquidity in a particular issue and its market price (if any);
• You may not be qualified to transact on the ATS; and
• You must transact through the broker-dealer or other qualified member, which can be SE Primary or another broker-dealer. If you are such a buyer or seller, contact SE Primary to request a copy of the terms and conditions of your trade. We custody cash and certain assets for investors.

Important Information Regarding Recommendations

As a FINRA member and SEC registered Broker-Dealer, we prioritize compliance with regulatory standards and ensuring that our recommendations, when given, align with the best interests of our clients. Given that part of our commitment is to continuously maintain high standards of practice, we wish to inform you of the following with respect to our offerings:

Reg D Offerings

SE Primary provides recommendations for investments in Reg D offerings under limited circumstances, through our affiliate, StartEngine Private (“SE Private”). These offerings are exclusively limited to accredited investors and involve private placements, which can carry higher risks but also offer potential opportunities for sophisticated investors.

Reg A+ Offerings

As emphasized above, SE Primary does not provide recommendations for Reg A+ offerings. While we facilitate access to Reg A+ investments on our platform, we do not offer specific recommendations or advice for these offerings

Reg CF Offerings

As emphasized above, SE Primary does not provide recommendations for Reg CF offerings. While we facilitate access to Reg CF investments on our platform, we do not offer specific recommendations or advice for these offerings.

Our services are tailored to ensure compliance with Reg BI as a FINRA member broker-dealer. For detailed information about a specific investment, please refer to the relevant Offering Circular, Offering memorandum, or Private Placement Memorandum (“PPM”)..

Scope and Terms of Our Relationship with You

Our Capacity

SE Primary is acting as a broker-dealer in connection with the Reg D recommendations provided. As a broker-dealer, SE Primary is engaged in facilitating transactions in securities and may receive compensation for its services. Before engaging in any investment activities, please review and understand the fees and charges associated with the services provided.

When SE Primary makes a recommendation to you, it is doing so as a broker-dealer, and the recommendation will be made in your best interest, without placing the interest of SE Primary ahead of your interests. This document is supplemental to other disclosure documents you have previously received that also contain relevant and important information, such as the StartEngine Form CRS and StartEngine Customer Account Agreement.

Material Fees and Costs That Apply to Your Transactions, Holdings, and Accounts

The fees charged by SE Primary in connection with each type of offering are often paid for by the issuer out of the proceeds of the offering. In certain cases, investors may pay a convenience fee to SE Primary in excess of their investment amount of up to 3.5% of their investment. Although such fee will be paid by the issuer it will be passed on to the investor.

Generally, the fees and costs that a customer may incur or receive in exchange for our brokerage services are as follows:

1. Commission Fees:

   Charged to you on the secondary sale of securities on SE Secondary.

2. Placement Fees:

   Charged to issuers for successful Reg A+, Reg D, and Reg CF capital raises.

Reg A+ and Reg CF Offerings

I. SE Primary is acting as a broker-dealer in connection with the Reg D recommendations provided. As a broker-dealer, SE Primary is Commissions from Secondary sales of Reg A+ and Reg CF securities: SE Primary offers Reg A+ and Reg CF offerings which may later trade on SE Secondary, and we will receive fees from their trading activity. If a company agrees to be quoted on SE Secondary, then they will be able to announce that their shares will become immediately tradable upon the close of their campaign. Companies must sign a quotation agreement with SE Primary to allow their investors to trade on SE Secondary. However, not every company that raises funding on StartEngine will trade on SE Secondary. For more information, please see below.

II. Placement fees from Reg A+ and Reg CF issuers: The more successful the Reg A+ or Reg CF capital raise, the more placement fees we receive. Placement fees for Reg CF offerings can be up to approximately 13%, although the exact fee structure may vary. For Reg A offerings, placement fees are typically capped around approximately 9%.

Reg D Offerings

I. Placement fees from Reg D issuers: The more successful the Reg D capital raise, the more placement fees we receive. Placement fees vary, given there is no explicit cap on underwriting compensation for Reg D offerings.

We encourage you to review the relevant issuer's offering document(s) for more specific information. Our goal is to ensure transparency while maintaining regulatory compliance.

SE Secondary and SE Bulletin Board

The fees charged by SE Primary in connection with either the purchase or sale of securities on SE Secondary or SE Bulletin Board may include a 5% transaction fee for the seller, while buying shares on SE Secondary is free. In addition, membership in the StartEngine Venture Club Program, which, as noted above, has an annual fee of $275, may be required to sell securities on both SE Secondary and the SE Bulletin Board.

Moreover, please review the below table, as noted within our Form CRS, for more information regarding our services, fees, and conflicts of interests:

For more detailed fees and costs associated with a particular investment, please refer to the relevant Offering Circular, Offering memorandum, or PPM.

Service Scope, Material Limitations, and Investment Risks

Material Limitations

As a FINRA member firm, SE Primary must disclose that certain recommendations may have material limitations. As noted above, these limitations can include, but are not limited to, factors such as illiquidity and highly speculative nature of the recommended investments. Retail customers should be aware of the potential risks and consider their individual circumstances before making investment decisions.

You or your designee are solely responsible for the ongoing review and monitoring of the investments held within your SE Account, including instances whereby SE Primary has made a recommendation to you. It is important you understand that SE Primary is not an investment advisor and is not required to update any previously provided recommendations. In addition, unless specifically agreed to in writing, we will not monitor any investment recommendation made to you or the investments held in your SE Account. You are responsible for independently ensuring that the investments in your SE Account remain appropriate given your Investment Profile. Moreover, we receive compensation in connection with you investing in affiliated-entity Reg A+, Reg CF, or Reg D offering.

General Investment Risks

All investments involve risk of financial loss. Reg A+, Reg CF, and Reg D allow companies to offer and sell securities to the public, but with more limited disclosure requirements than what is required for publicly reporting companies. Key risks include:

• Speculative Nature.

  Investments in startups and early-stage ventures are speculative and you must understand that the businesses may fail. Unlike an investment in a mature business where there is a track record of revenue and income, a startup often relies on the development of a new business, product, or service that may or may not find a market.



• Illiquidity.

  Although there is no resale restriction, investments may need to be held for an indefinite period and may not be easily sold. If the securities are not sold, and if there are no plans for the securities to be listed on an exchange where you can quickly and easily trade the securities, you will have to locate an interested buyer when you do seek to resell your investment.



• Economic Conditions and Market Volatility.

  The overall state of the global economy and capital markets significantly impacts all issuers. Factors such as inflation, energy costs, geopolitical issues, and the availability and cost of credit can lead to increased market volatility and lower economic and market expectations, including those for this investment. These and other unlisted factors may heighten the risk of issuer failure and the potential loss of the entire investment. Startups and early-stage ventures are especially vulnerable to these economic conditions.



• Forward-Looking Statements.

  The materials provided to you may include forward-looking statements, such as “will be,” “believe,” “anticipate,” “intend,” “plan,” “seek,” “expect,” “estimate,” “project,” and similar terms. These statements about future events and the issuer's potential financial performance are subject to risks and uncertainties that could cause actual events or results to differ significantly from those anticipated. Risks include market changes, technological advancements, regulatory shifts, and new market entrants. Given these substantial risks and uncertainties, these forward-looking statements should not be interpreted as guarantees of the issuer’s objectives or plans. You should recognize the significant risk that these goals may not be achieved.