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The JEREMIE programme in AUVERGNE BRUSSELS 11 May 2011

The JEREMIE programme in AUVERGNE BRUSSELS 11 May 2011.  JEREMIE Steering Committee.  JEREMIE Administrator. Determines the investment strategy Checks the implementation of the programme. Advises the Steering Committee Selects Fund Beneficiaries. JEREMIE Auvergne

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The JEREMIE programme in AUVERGNE BRUSSELS 11 May 2011

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  1. The JEREMIE programme in AUVERGNEBRUSSELS 11 May 2011

  2.  JEREMIE Steering Committee  JEREMIE Administrator • Determines the investment strategy • Checks the implementation of the programme • Advises the Steering Committee • Selects Fund Beneficiaries JEREMIE Auvergne Profit-Sharing Fund SOFIMAC Partners carries out the operations concerning the JEREMIE profit-sharing fund Only the Auvergne Region is authorised to pay in to the JEREMIE fund The Regional Public Body is the programme’s managing authority €25.2 million over the period 2007-2013 +  JEREMIE Funds are assigned to various financial intermediaries Support for small businesses Support using own funds Support for innovation  The State pays the JEREMIE ERDF amount (18 million euros) as a grant to the Region  The Auvergne Region pays the ERDF grant + its own contribution (7.2 million euros) into the JEREMIE fund • Businesses are financed by financial intermediaries that receive funds from JEREMIE Framework Finance Agreement ORGANISATION

  3. ASSETS ALLOCATED AND ALLOCATION FORECASTS *Allocations planned over 4 years Allocations subject to responses to calls for expressions of interest

  4. HONOUR LOANS AND MICROCREDITS Contract awarded on 28 January 2010 Amounts awarded by the JEREMIE AUVERGNE Venture-Capital Fund for the years 2010/2011: 1. SUPPORT FOR SMALL BUSINESS

  5. HONOUR LOANS AND MICROCREDITS 1. SUPPORT FOR SMALL BUSINESS

  6. HONOUR LOANS AND MICROCREDITS Monitoring carried out by: Auvergne Regional Chamber of Commerce and Industry (CRCIA ) Objectives: allow selected structures to increase their ability to intervene in favour of setting up / selling businesses by making honour loans 1. SUPPORT FOR SMALL BUSINESS *payments in hand

  7. GUARANTEE PROVISIONS Regulatory requirements linked to ERDF funds may dissuade potential candidates (rules on the re-use of funds under article 78-7 of Regulation (EC) 1083 / 2006, modified by Regulation (EC) 846 / 2009) 1. Re-using any interest that may be generated to finance projects that come under financial engineering for the benefit of small or medium-sized businesses; 2. At the end of financing by the Administrative Body, resources to be re-used, either in a financial-engineering instrument or for the benefit of SMEs by other methods, etc. Current practices in relation to guarantee provisions: 1. Using remuneration from guarantee deposits to finance the operating costs of their structures; 2. Permanent re-use of allocated funds, through guarantees that generate a significant leverage effect on credits allocated by their financial partners. Consultation of regional guarantee provisions in hand, awaiting confirmation of their interest or otherwise in the JEREMIE programme, in order to consider continuing with the publication of a call for statements of interest 1. SUPPORT FOR SMALL BUSINESS

  8. JEREMIE INNOVATION 1 VENTURE-CAPITAL FUND Set up in: December 2009 Size: 12.5 million euros Management company: SOFIMAC Partners Objectives: boost businesses’ own funds at the commercial pump-priming or start-up stage. For all innovative sectors. Current make-up of the portfolio of prospects: - 15 dossiers currently being assessed; - 5 dossiers put forward to the Strategic Guidance Committee.   . 3D texture modelling: investment of up to €500 000 . Electronic products: investment of up to €200 000 . Diagnosis devices for orphan diseases: investment of up to €400 000 . Electronic instrumentation: investment of up to €500 000 . Facial-recognition software: adjourned (€450 000) Distribution by sector of the overall portfolio of prospects: - 60%: Information and Communication Technologies (ICTs); - 30%: Health and Bio-technologies; - 10%: Other (Electronics, etc.). 2. SUPPORT FOR INNOVATION

  9. JEREMIE INNOVATION 1 VENTURE-CAPITAL FUND • Specific features of the JEREMIE INNOVATION 1 fund • 100% funded from the public purse • Application of the progress under regime N629 / 2007 • Size: below 15 million euros • Each investment is less than 1.5 million euros • A Call for Expressions of Interest showed the lack of private investors in this fund • Intervention by JEREMIE INNOVATION 1 never accounts for more than 50% of the capital of the business • - Private funds are provided by other, private investment funds (leverage effect) • The ability to make provision for the fund solely from the public purse is a very significant advantage. 2. SUPPORT FOR INNOVATION

  10. ALLOCATION FORECASTS Maturation Fund: €1 000 000 (€500 000 from private funds and €500 000 from JEREMIE) Regional think-tanks on a plan to set up a maturation fund that favours the promotion of research (intervening before the business is set up) 2. SUPPORT FOR INNOVATION • Regional financing chain: Pre-set-up phase Post-set-up phase MATURATION Profit-Sharing Seed Loan (OSEO) Mission: Finance all expenses of the innovation programme to favour later intervention by a seed fund • Regional Innovation Fund 1, 2, and 3 (CRA) • Mission: Finance: • Opportunity and structuring study; • Feasibility phase (proof of pre-production concept); • Developing innovation. • Maturation Fund • Negotiate and draw up partnership contracts; • Maturation of innovative projects; • Transfer of technologies and of know-how (licensing); • Managing Intellectual Property; • Spinning off Innovation Scholarship 1, 2, and 3 (Auvergne Regional Council - CRA) Mission: Finance technological research projects (specific scientific equipment; mission costs; indemnity). Seed and Start-Up Capital (JEREMIE INNOVATION 1) Mission: Capital finance for commercial launch and finalising R&D research (end of pump-priming / beginning of start-up phase) Honour Loan Innovation (AT2I+)

  11. ALLOCATIONS FORECASTS Maturation Fund: €1 000 000 (€500 000 from private funds and €500 000 from JEREMIE) Regional think-tanks on a plan to set up a maturation fund that favours the promotion of research (intervening before the business is set up) 2. SUPPORT FOR INNOVATION Taking a share of capital Investment company (Public Limited Company) - Boost company spin-offs by taking shares in their capital • Maturation of Intellectual Property • Identify management • Constituting human resources • Drawing up a Business Plan • Technological maturation Business precursor (Limited Company / Limited-Liability Company) • Head of Maturation Fund • Up-stream detection of projects and of patent potential; • Support for defining the Intellectual Property strategy; • Support for defining the promotional strategy; • Development strategy; • Support the business precursor in defining its Business Plan; • Contribute to strengthening human resources. Support Creation Transfer Industrial sale or Start Up 11 Maturation Fund: €1 000 000 (€500 000 from private funds and €500 000 from JEREMIE) Regional think-tanks on a plant to set up a maturation fund that favours the promotion of research (intervening before the business is set up)

  12. ALLOCATIONS FORECASTS Maturation Fund: €1 000 000 (€500 000 from private funds and €500 000 from JEREMIE) Regional think-tanks on a plan to set up a maturation fund that favours the promotion of research (intervening before the business is set up) 2. SUPPORT FOR INNOVATION Licences awarded by university establishments: Investments made by the investment company:

  13. ALLOCATION FORECASTS • Calls for expressions of interest published in June 2010. Decision at the beginning of 2010 • Mezzanine fund: €3 720 000, operational in the first quarter of 2011 • For selecting a management company in order to set up and manage a Mezzanine finance fund (Venture-Capital Fund). • Make a finance tool available to Auvergnat SMEs in quasi-own funds (convertible or non-convertible bonds) enabling, at a time of crisis, bank finance to be added to by means of small-scale finance (€100 000 to €300 000) to consolidate Auvergnat businesses’ own funds. • Duration: 10 years. Investment: 2010-2014. Disinvestment: 2014-2019 • Number of dossiers: 12 to 14 dossiers. • Risk-capital structures: €250 000, currently undergoing analysis • For selecting one or more investment-capital companies to consolidate the own funds of Auvergnat SMEs, by means of investments of up to a range from €50 000 to €100 000. • Objective: regional development (which it is sometimes difficult to reconcile with the requirements linked to the management of investment funds). 3. SUPPORT TO BOOS SMEs’ OWN FUNDS

  14. SPECIFIC FEATURES OF THE JEREMIE FUND FOR ERDF MANAGEMENT • The JEREMIE programme is a strand in its own right of the 2007-2014 Operational Programme • ERDF funds remain acquired by the Auvergne, and can be re-used at the end of the programme • As soon as the ERDF grant is paid in to JEREMIE, that amount counts as a paid-off expense: facility to avoid automatic decommitment 4. THE JEREMIE PROGRAMME AND ERDF MANAGEMENT

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