N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 1

CHIPS for America

How Private Capital Can Chip In

October 27, 2023
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 2

Today’s Speakers

Srujan Linga

Senior Investment &

Financial Structuring Director,

Head of Financial Structuring

Farha Faisal

Investment Director

Caroline Sambuco

Investment Principal

Harry Finegold

Investment Principal
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 3

CHIPS for America Vision

Economic 

Security

The CHIPS Act will strengthen 

supply chain security and 

increase economic resilience 

in critical sectors.

National 

Security

The CHIPS Act will support

U.S. manufacture of high-quality 

and secure chips for defense 

and other critical infrastructure 

applications.

Future 

Innovation

The CHIPS Act will spur 

innovation, increase 

competitiveness, and ensure 

long-term U.S. sector leadership.

Source: “Vision for Success: Commercial Fabrication Facilities,” February 28, 2023
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 4

N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 4

Vision for Success: Materials and Equipment Facilities

By the 

end of the 

decade...

Strengthen Supply Chain Resilience

✓ The U.S. and its allies will reduce chokepoint 

risks flowing from geographic concentration

✓ Supply chain participants will improve the 

transparency of demand and supply to reduce 

the risks of production disruptions

✓ The U.S. will have incentivized major U.S. 

equipment and materials suppliers to increase 

their footprints in the U.S.

✓ Non-U.S. suppliers of the world's most advanced 

equipment, materials, and subsystems will also 

establish large-scale footprints in the U.S.

Advance U.S. Technology Leadership

Support Vibrant U.S. Fab Clusters

✓ Each CHIPS-funded fab cluster in the U.S. will be supported by dozens

of suppliers, including many investing in the U.S. for the first time

✓ State and local entities encouraged to help facilitate the expansion of

these ecosystems
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 5

Vision for Success: Commercial Fabrication Facilities

By the 

end of the 

decade... 

✓ The U.S. will have at least two new large-scale 

clusters of leading-edge logic fabs

✓ U.S.-based engineers will develop the process 

technologies underlying the next gen of logic chips

Leading-Edge Logic

✓ The U.S. will be home to multiple high-volume 

advanced packaging facilities

✓ The U.S. will be a global leader in commercialscale advanced packaging technology

Advanced Packaging

✓ U.S.-based fabs will produce high-volume memory 

chips on economically competitive terms

✓ R&D for next-generation memory technologies 

critical to supercomputing and other advanced 

computing applications will be conducted in the U.S.

Memory

✓ The U.S. will have strategically increased its 

production capacity for current-gen and mature 

chips

✓ Chipmakers will also be able to respond more 

nimbly to supply and demand shocks

Current-Generation and Mature
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 6

Program Priorities

Economic 

and national 

security 

objectives

Commercial 

viability

Financial 

strength

Technical 

feasibility 

and 

readiness

Workforce 

development Broader

impacts
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 7

Funding Opportunities

For commercial 

leading-edge, current, 

and mature node 

fabrication facilities

February 28, 2023 June 23, 2023

For large 

semiconductor 

materials and 

equipment facility 

projects $300M+

For smaller 

semiconductor 

materials and 

equipment facility 

projects under $300M

September 29, 2023

To support the 

construction of 

semiconductor R&D 

facilities

The CHIPS Program Office has received over 500 statements of interest

and 100 pre-applications and full applications
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 8

Funding Instruments

Funding Availability

Direct Funding

$38.2B

Loans Loan 

Guarantees

up to 

$75B

Funding by Project

Direct funding expected to 

be 5-15% of project 

capital expenditures

Expected total amount of a 

CHIPS Incentives Award 

(across loans, loan 

guarantees and grants) 

expected not to exceed 

35% of project capital 

expenditures

Loan Terms

• No fixed limit on the loans or 

guarantees that a project may receive 

(total amount of CHIPS incentives 

across loans, loan guarantees and 

grants expected to be below 35% of 

project CapEx)

• Loan guarantees are not expected to 

cover more than 80% of any thirdparty debt obligation

• Tenor: Potentially up to 20-25 years

• Interest Rate: based on cost of funds 

to Department of Treasury plus a 

portion of the spread to the market 

rate

• Structure: Corporate or project 

finance or hybrid option available 

• Amortization: Corporate loans will 

have bullet maturities; Project finance 

loans need to be amortized
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 9

Funding – Smaller Supply Chain Projects

Funding Instruments Total Funding Funding by Project

Up to $500 

million in direct 

funding 

available in total

Direct funding

expected to be 10% 

of project capital

expenditures*

Direct 

Funding

Additional 

announcements 

forthcoming to 

support credit 

provision

CPO is also exploring other opportunities 

to provide credit

Launch a “lender marketplace” to connect 

loan-seekers with private sector institutions

*In rare cases, applicants may receive an award of either 20% or 30% with demonstrating a compelling case for the project and that additional funding is necessary. Projects eligible 

for the Advanced Manufacturing Investment Credit will not receive an award of more than 20%.
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 10

How Private Capital Can ‘Chip’ In

Examples of Private Capital Solutions to Support CHIPS Applicants

Corporate Loans Asset-Backed / NonRecourse Project Loans

Consortiums / Joint 

Ventures Sale Lease-Backs

Customer Supply 

Agreements 

Backed Financing

Potential 

Capital 

Providers

Description

Potential

CHIPS 

Support

• Institutional Capital Markets, 

Banks, Private Credit, 

Infrastructure Funds, 

Insurance Companies, 

Pension Funds, Sovereign 

Wealth Funds, etc. 

• Financial institutions provide 

direct corporate loans for 

semiconductor projects

• Loans could potentially be 

secured by assets such as 

Semiconductor equipment, 

inventory, IP, real-estate or 

other infrastructure

• U.S. Govt. could underwrite 

and provide a loan alongside 

private loan

• U.S. Govt. could provide partial 

loan guarantees to help 

facilitate the loan and improve 

economics to the applicant 

• Institutional Capital Markets, 

Banks, Private Credit, 

Infrastructure Funds, 

Insurance Companies, 

Pension Funds, Sovereign 

Wealth Funds, REITs, etc.

• Financial institutions provide 

asset-backed non-recourse 

project loans for 

semiconductor projects 

• Loans supported by project 

cash flows and assets such as 

real estate, equipment, 

customer contracts, IP, 

inventory, etc. 

• U.S. Govt. could underwrite 

and provide a loan alongside 

private loan

• U.S. Govt. could provide partial 

loan guarantees to help 

facilitate the loan and improve 

economics to the applicant

• Parent Companies, Private 

Equity, Infrastructure 

Funds,Sovereign Wealth 

Funds, Pension Funds, etc.

• Financial institutions form 

consortiums or enter jointventures with semiconductor 

companies to build projects 

• In addition to grants, U.S. 

Govt. could provide capital via 

low-cost, long-duration loans 

or guarantee debt issued by 

such consortiums/JVs to 

improve the overall economic 

returns of such ventures

• Infrastructure Funds, REITs, 

Insurance Companies, 

Pension Funds, Private Credit, 

etc.

• Financial institutions enter sale 

lease-back transactions

involving equipment, realestate, and other infrastructure 

assets 

• U.S. Govt. could potentially 

provide low-cost loans to entities 

buying and leasing equipment or 

other assets to semiconductor 

companies to help facilitate the 

transaction and improve 

overall economics

• Customers, Banks, Private 

Credit, Insurance Companies, 

Structured Credit Funds, 

Diversified Asser Mangers, 

Private Equity, etc.

• Customers enter 

supplycontracts with 

semiconductor companies to 

secure supply of 

semiconductors. 

Semiconductor Companies 

raise financing backed by 

such supply contracts

• U.S. Govt. could potentially 

provide low-cost loans 

backed by such supply 

contracts to help facilitate 

transactions and improve 

overall economics
N ational Institute of S tandar ds and Techno l o gy | U .S . Departm e n t of C ommerce 11

Next Steps

• Visit CHIPS.gov for resources, including:

• Notice of Funding Opportunity

• Vision for Success paper

• FAQs and fact sheet

• Lender/Advisor Portal Resource - Forthcoming

• Please contact the CHIPS Program Office if you:

• Have ideas about potential new financing structures

• Would like to be included as an interested financial institution in the 

Lender/Advisor Portal to get connected with potential CHIPS applicants

• Contact us

• financialinstitutions@chips.gov – financial institution / advisor inquiries

• askchips@chips.gov – general inquiries

• apply@chips.gov – application-related inquiries