Policies

CleanTech Partners, Inc., (CTP) is a 501(c)(3) non-profit, non-stock Wisconsin corporation. CTP provides investment capital and business services to technology developers in key business clusters. CTP also helps identify and use its resources to overcome market barriers so that technologies are commercialized and/or adopted more quickly in Wisconsin. To help accomplish its mission, CTP has established a Technology Investment Fund ("Fund"). Policies and procedures that follow govern the operations of the Fund.*

General provisions

The purpose of the Fund is to accelerate the development and commercialization of technologies that are new in Wisconsin's markets and to provide innovative financing for energy efficiency best practices. The fund offers capital investment to a) qualifying startup or seed-stage technology companies for the express purpose of enabling them to develop and attract additional investment concurrently or in the future and b) established companies that wish to commercialize new technologies and/or implement energy efficiency projects in Wisconsin. The Fund is intended to supplement, not supplant private sources of capital.

The Fund's objectives and operations reflect the nature of the grants it receives. Because the Fund was initially capitalized with grants made from the Wisconsin Public Benefits Program via the "Focus on Energy" program, CTP's initial investments have been made to support technologies which lead to savings of energies within the purview of Focus on Energy: electricity, natural gas, and/or propane.

CTP's objectives are to: 1) Improve energy efficiency through the commercialization and propagation of new technology, 2) Increase economic development in Wisconsin through energy efficiency, and 3) Achieve a return on investment that enables the Fund to become a sustainable source of capital to qualifying technology startup and established companies.

Fund administration

The Fund's accounts are audited annually.

The Fund is overseen by a five-member Technology Investment Board ("Fund Board"), appointed by CTP's Board of Directors, including one person representing the source of the Fund's money. The remaining four members have background in lending, equity investments, large companies, small tech business, energy, accounting, and/or law; one of these is a member of the CTP Board of Directors and serves as Chair of the Fund Board.

The Fund is administrated by a Fund Administrator, a CTP employee designated by the CTP Board of Directors. The Fund Administrator is responsible for the day-to-day administration of the Fund portfolio. The Fund Administrator maintains confidential written records of all activities, including, for example, Fund Board meetings, investment applications, legal documents, drawdown notices, and other related documents.

CTP staff, including the Fund Administrator, are responsible for: explaining the Fund to applicants; assisting applicants in completing funding requests; evaluating proposed investments; performing due diligence; conducting field visits; structuring, negotiating and documenting transactions; providing mentoring and monitoring of client companies.

Grant money provided to the Fund for investments may not be used to pay administrative costs. Proceeds from Fund Board-approved investments and interest on the Fund's cash-awaiting investment may be transferred to CTP operative account and used to pay administrative costs. Money provided to the Fund by organization on a non-grant basis or which is co-invested in projects under CTP's leadership may be subject to a fee by CTP to cover administrative costs. Finder's fees, if any, are paid from an applicant's own funds, not by money from the Fund.

Eligibility

An entity that places monies into the Fund may designate investment criteria, including types of businesses eligible. Investments funded by Focus on Energy monies are available only for activities having an impact on reducing the use of electricity, natural gas, or propane.

Capital may be provided to a) startup or seed-stage technology companies to enable them develop and attract additional investment concurrently or in the future, and b) to established companies that wish to implement energy efficiency projects. All capital provided by the Fund must be capable of being repaid or otherwise similarly recycled into transactions such as those described in "Investment terms and conditions," below. CTP may use the Fund to purchase intellectual property, but only for the purpose of resale or commercialization.

Fund investments are generally not available for: a) refinancing or reimbursement of expenditures made prior to investment approval, b) grant-funded basic research, c) residential building, and d) taxes and fines.

Applicants are not discriminated against on the basis of age, race, religion, color handicap, sex, physical condition, developmental disability (as defined in s. 51.01 (5) of the Wisconsin Statutes), sexual orientation or national origin. No member of the Fund Board or any other official, employee, consultant, or agent of the CTP who exercises decision-making functions or responsibilities in connection with the implementation of the Fund is eligible for financial assistance from the Fund.

Minimum requirements

To be eligible for funding, an investment proposal must meet the following minimum requirements:

  1. Eligible Applicant: The business venture's equity owners must have a significant personal stake in the success or failure of the investment.
  2. Financial Feasibility and Business Viability: The applicant must demonstrate business viability and offer the reasonable prospect of a return of CTP funding. Applicant must have an acceptable financial history.
  3. Technical Feasibility: The technology shall be technically feasible, serve to reduce energy use per unit output, and be capable of being produced on a commercial basis.
  4. Compliance with Applicable Laws: Applicants shall comply with all applicable local, state, and federal laws, regulations, and codes.
  5. Wisconsin Related: The applicant shall be Wisconsin-based or have a significant application of its technology in Wisconsin.

Investment terms and conditions

Investments in the form of secured or unsecured loans, subordinated loans, convertible loans, stock, stock options, warrants, or similar instruments are available to eligible applicants who meet the minimum Fund requirements. No single applicant shall receive total funding of more than 10% of the net assets of the Fund.

Loans for working capital shall have a maximum term of five years. Loans for machinery, equipment, fixtures, and related costs shall have a maximum terms of ten years. The interest rate on loans may be fixed or floating.

Applicants may be charged fees to cover charges for processing an application, such as investment origination fees, closing fees, servicing fees, and CTP's out-of-pocket expenses.

Application procedures

Applications are accepted at any time. There are no forms, as each applicant, and the funding needed is unique. The process starts with contacting a CTP staff member. CTP's investment staff reviews each application using a two gate process, an initial assessment followed by an in-depth detailed review. Both of these steps entail significant interaction between the applicant and CTP.

Companies that pass CTP's review are offered a term sheet defining the proposed investment. Upon receipt of a signed termed sheet, CTP staff prepares a detailed analysis for approval by the CTP Investment Fund Board. The Investment Fund Board will review the application within 45 days (more typically 2-3 weeks). The Fund Board may approve, reject, or request additional information about the application. If approved, an investment closing shall be arranged to execute the necessary documents. Modest legal fess may be paid by the applicant.