Download 1 - The North West Fund

ANNEX A
NWBF001 – Procurement of Legal Services Framework Agreement – Information Note
1.1 Background Information
North West Business Finance Limited (NWBF) has been established to oversee the delivery
of the Venture Capital Loan Fund (VCLF) under the Joint European Resources for Micro to
Medium Enterprises Initiative (JEREMIE) in the North West of England.
The JEREMIE initiative offers EU Member States, through their national or regional
Managing Authorities, the opportunity to use part of their European Union (EU) Structural
Funds to finance small and medium-sized enterprises (SMEs) by means of equity, loans or
guarantees, through a revolving umbrella fund. The initiative was developed by the
European Commission (EC) and the European Investment Fund (EIF), which is part of the
European Investment Bank (EIB) Group.
JEREMIE provides for a range of debt and equity financial tools to obtain the most
appropriate allocation of funds according to national, regional or local requirements.
The NW VCLF is funded by a European Regional Development Fund grant under the 200713 programme and is matched equally by private sector loan funding from the European
Investment Bank (EIB). The North West fund will run for an initial investment period up to the
end of December 2015.
The North West Fund is a £185m evergreen investment fund established to provide debt and
equity funding from £50,000 to £2 million to small and medium sized enterprises (SMEs*)
based in, or relocating to, the North West of England.
The Fund comprises of six specific funds, each of which is managed by a Fund Management
company appointed by NWBF. The fund managers will invest the capital over the next five
years in eligible small to medium enterprises (SMEs) from early stage through to
development and expansion.
1.2 The Requirement
This procurement is for the establishment of a framework agreement of suitably qualified
suppliers to provide specialist legal services, where required, including drafting investment
and funding contracts between the NW fund managers listed below and SME’s, who have
been approved to receive investment.
In addition we require Potential Providers to review intellectual property issues arising in
respect of investments to SME’s and to advise on employment issues which arise in
connection with SME’s.
Potential Providers will need to advise on the transactional documentation which is involved
in making an investment to an SME’s which will have, or intend to have, intellectual
property rights and Potential Providers will be expected to advise the funds on all matters
relating to intellectual property.
Finally, Potential Providers will advise on employment matters which arise when acting for a
fund which is making an investment to businesses where employees are key to that
investment and also where there may be employment related issues such as restrictive
covenants.
Although the number of suppliers is not fixed at this stage it is intended to appoint between 5
and a maximum of 20 suppliers onto the framework.
Being selected as a framework supplier does not guarantee the award of any individual
contracts under the Framework Agreement.
SUPPORTED BY
ANNEX A
NWBF001 – Procurement of Legal Services Framework Agreement – Information Note
It is anticipated that between 50-100 investments are likely to be made over the next 12
month period, however this figure is for information only and the NWBF cannot guarantee
this or any business.
It should be noted that the Framework is being available for the fund managers to
use, it is not mandatory that the Fund Managers use the Framework.
Division into LOTS
The service will be divided into Lots and suppliers may bid for one or more Lots and as a
result may be taken forward to the ITT stage for one or more Lots.
Lot 1 – Drafting of investment contracts together with advising on associated legal services
Lot 2 – Intellectual property advice in respect of the issues arising when investing in SME’s
which hold or will hold intellectual property rights.
Lot 3 – Employment law advice in respect of employment issues arising at SME level.
The services will be called off under the framework by NWBF and the 6 Fund managers
named below:
The services are to be provided predominantly in the North West Region of England,
including Merseyside, Cumbria, Lancashire, Greater Manchester and Cheshire.
The six funds that comprise The North West Fund are:
1) Venture Capital Fund £30m administered by EV Group
The Venture Fund is for start-ups and early-stage businesses under £1m turnover. The
emphasis for this fund is on backing entrepreneurs who can demonstrate a flair for business.
This fund operates across all sectors including technology and knowledge-based businesses
(outside those targeted by the specific priority sector funds).
The Venture Fund provides risk capital and can include a combination of equity and loan
support.
2) Development Capital Fund, £45m Administered by YFM Group Ltd
Development Capital fund comprises investment capital to support business expansion in
circumstances where a business is already generating trading income and cash flow.
It has a broad sector range, outside those targeted by the specific priority sector funds, but
with an emphasis and focus on the regional economic priority sectors including advanced
engineering and materials, food and drink and business and professional services and also
businesses with strong export potential.
The fund comprises a combination of equity, quasi-equity or mezzanine capital and loans
(linked to equity).
SUPPORTED BY
ANNEX A
NWBF001 – Procurement of Legal Services Framework Agreement – Information Note
3) Business Loan Fund, £35m, administered by FW Capital Ltd.
Business Loan Fund is aimed at those businesses that can demonstrate a strong case for
investment; which includes business plans to show growth and ability to service a loan.
Loans can typically be repaid over 3.5 to 5 years.
Security, such as business assets or personal guarantees may be required.
The following 3 funds are focused on priority sectors and will provide both venture capital
and development capital.
4) Energy & Environmental Fund, £20m administered by CTIP
This sector includes companies involved in cleaner fuel production; electricity or heat
generation; transportation of heat and electricity; end use of energy in transport, industry and
the built environment; water and waste water treatment and recycling and waste
management.
This fund provides investment into, amongst other things, technology businesses, services
or consultancy companies and renewable projects. It is anticipated that businesses will
typically have some commercial demonstration of the technology used.
Combination of equity, quasi-equity or mezzanine capital and loans (linked to equity).
5) Biomedical Fund, £25m administered by SPARK Impact
This fund provides a flexible equity package for growth orientated businesses operating
within the sector.
This sector includes companies involved in pharmaceuticals (research, development and
manufacture of drugs and biopharmaceuticals); biotechnology; diagnostics; clinical research
organisations; contract manufacturing organisations; analytical services and sciences; and
healthcare technologies and medical devices.
Combination of equity, quasi-equity or loans (linked to equity).
6) Digital & Creative , £15m administered by AXM
This fund provides a flexible equity package for growth oriented businesses operating within
the sector.
The sector includes companies involved in advertising; architecture; arts & antiques; crafts;
design; designer fashion; digital and ICT; music; publishing; radio and television; software;
computer games and electronic publishing; video; film and photography; and visual and
performing arts.
Combination of equity, quasi-equity or mezzanine capital and loans (linked to equity).
SUPPORTED BY
ANNEX A
NWBF001 – Procurement of Legal Services Framework Agreement – Information Note
1.3 Framework Agreement
The successful provider(s) shall be admitted to a Framework Agreement. The call off
element of the Framework Agreement shall be activated when a fund Manager or NWBF
raises a call off order (each call off order being a contract in its own right). Any specific
requirements for any Fund Manager or NWBF shall be set out in the call off order.
In the event that several providers have been admitted to a framework agreement the Fund
Managers and or NWBF, may need to hold a mini competition with providers for the
provision of any call off order if they are not capable of identifying the most suitable provider
to meet their requirements.
It is anticipated that the Framework Agreement will be 4 years in duration.
SUPPORTED BY