[Federal Register Volume 89, Number 142 (Wednesday, July 24, 2024)]
[Notices]
[Pages 59904-59907]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-16179]


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DEPARTMENT OF DEFENSE

Office of the Secretary

[Docket ID: DoD-2024-OS-0073]


Information Request on Financing Support for Covered Technology 
Categories--Specific to Companies and Trade Associations

AGENCY: Office of Strategic Capital (OSC), Office of the Under 
Secretary of Defense for Research and Engineering, Department of 
Defense (DoD).

ACTION: Notice; request for information (RFI).

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SUMMARY: The OSC is seeking information from companies and trade 
associations regarding strategic capital needs for industries related 
to the Covered Technology Categories to inform the design and 
implementation of the DoD Loan Program.

DATES: Comments must be received by October 22, 2024. Written comments 
in response to this RFI should be submitted in accordance with the 
instructions in the ADDRESSES and SUPPLEMENTARY INFORMATION sections of 
this notice.

ADDRESSES: Interested parties may submit comments on this transaction 
electronically on www.regulations.gov. To submit a comment, enter 
``Information Request on Financing Support for Covered Technology 
Categories--Specific to Companies and Trade Associations'' under the 
heading ``Enter Keyword or ID'' and select Search. You can also search 
by the Docket ID, DoD-2024-OS-0073. Follow the instructions provided at 
the `Submit a Comment screen'.
    Comments can also be sent by mail to Department of Defense, Office 
of the Assistant to the Secretary of Defense for Privacy, Civil 
Liberties, and Transparency, 4800 Mark Center Drive, Mailbox #24, Suite 
08D09, Alexandria, VA 22350-1700.
    Please include your name, company name (if any) and ``Information 
Request on Financing Support for Covered Technology Categories'' on any 
attached document.
    Comments sent by any other method, to any other address or 
individual, or received after the end of the comment period, may not be 
considered.

FOR FURTHER INFORMATION CONTACT: For questions about this notice, 
please contact David Vidal, Office of Strategic Capital Director of 
Credit Programs, at [email protected], Tel. No. 703-545-
1903. Please direct media inquiries to the OSC Press Team at 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    In December 2022, the Secretary of Defense established OSC to 
attract and scale private capital to technologies critical to the 
national security of the United States. Furthermore, in 2024, Congress 
authorized OSC as part of the National Defense Authorization Act (NDAA) 
for Fiscal Year 2024. The NDAA states that OSC shall:
    (a) develop, integrate, and implement capital investment strategies 
proven in the commercial sector to shape and scale investment in 
critical technologies and assets,
    (b) identify and prioritize promising critical technologies and 
assets that require capital assistance and have the potential to 
benefit the DoD, and
    (c) make eligible investments in such technologies and assets, such 
as supply chain technologies not always supported through direct 
investment.

Covered Technology Categories

    The NDAA designates the following 31 categories as a ``Covered 
Technology Category.''

 Advanced bulk materials (including dielectrics, alloys, 
polymers, and composites)
 Advanced manufacturing (including upgrades for increasing the 
efficiency or quality of existing production processes or for enabling 
commercialization of new technologies)
 Autonomous mobile robots
 Battery storage (including lithium ion, advanced lead acid, 
and alternate batteries, as well as fuel cells)
 Biochemicals
 Bioenergetics
 Biomass (including conversion-ready feedstock)
 Cybersecurity
 Data fabric (including integration across disparate domains)
 Decision science (including ensemble learning methods for 
portfolio optimization)
 Edge computing
 External communication
 Hydrogen generation and storage
 Mesh networks (including off-grid communications)
 Microelectronics assembly, testing, or packaging
 Microelectronics design and development
 Microelectronics fabrication
 Microelectronics manufacturing equipment
 Microelectronics materials
 Nanomaterials and metamaterials
 Open RAN
 Optical communications (including free space and optical 
fiber)
 Sensor hardware
 Solar (including power system and management components)
 Space launch
 Spacecraft
 Space-enabled services and equipment (including in-space 
operations and associated ground equipment)
 Synthetic biology
 Quantum computing
 Quantum security
 Quantum sensing

    The NDAA authorizes OSC to provide capital assistance, defined as a 
``loan, loan guarantee, or technical assistance'' for eligible 
investments. Eligible investments are those made in a technology that 
is (a) in a Covered Technology Category and (b) not solely utilized in 
defense applications. OSC is seeking public comment on the capital 
needs of industries and assets related to the Covered Technology 
Categories to inform the design of DoD loan program.

Specific Requests for Information

    The following statements and questions cover the major topic areas 
for which OSC seeks comment. They are not intended to limit the topics 
that may be addressed. Responses may include any topic believed to 
inform the U.S. Government's efforts in developing recommendations for 
supporting the design of the DoD Loan Program, regardless of whether 
the topic is included in this document.
    Respondents are encouraged to respond to any or all of the 
following questions and topic areas. Responses may include estimates, 
which should be designated as such. Your responses may include 
supporting data and examples. We welcome submission of publications or 
studies that support your responses as attachments.

Questions

    The questions section of this Federal Register notice is split into 
four parts: (a) General, (b) Financing, (c) Economic Outlook, and (d) 
Competition.

General

    1. From the Covered Technology Categories referenced in the 
Background of this SUPPLEMENTARY INFORMATION section, please select at 
least one Category that best represents your company.
    2. What is the 6-digit North American Industry Classification 
System (NAICS) code for your business? If your business has more than 
one NAICS code, please list those associated with the Covered 
Technology Categories noted in your response to Question 1.
    3. Does your company largely produce, integrate, or otherwise use 
equipment and/or services for a purpose that aligns with any of the 
Covered Technology Categories enumerated in the Background section? 
Please list each Covered Technology Category and define the 
relationship.
    4. What are the primary technology asset(s)/equipment utilized in 
your sector for production or provision of services? What is the 
typical useful life of these technology equipment/assets?
    5. Is there a secondary market for the technology equipment/
asset(s) noted in Question 4? If so, how is the secondary

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market value typically established (e.g., public benchmark, appraisals, 
etc.)?
    6. If applicable, how are these technology equipment/asset(s) 
transported from the source of origin to your facilities (airship, sea 
ship, rail, trucks)? If shipped via sea, are you/or your supplier able 
to transport them on a U.S.-flagged vessel?
    7. How long has your company been in business? How many years has 
your firm operated in the specified Covered Technology Category?
    8. What was your company's annual revenue over the past five years? 
(Please list each year and the respective annual value).
    9. What were your company's earnings before interest and taxes 
(EBIT), and EBIT margins from the past five years? (Please list each 
year and the respective annual value).
    10. What is your company's actual or implied Credit Rating Agency 
rating (e.g. BB+, Ba1, etc.)?
    11. What is the current size of your company by employee count?
    12. In which city, state, and countries are your company's 
headquarters, and manufacturing plants located?
    13. In which geographies are your suppliers most concentrated? 
Please specify the state(s) or country(ies) if foreign.
    14. In which geographies are your customers most concentrated? 
Please specify the state(s) or country(ies) if foreign.
    15. Who are the major lenders in your market segment (e.g., banks, 
specialty firms, private credit)? Please specify the institutions.
    16. What percentage of your annual revenue has been spent on 
Research and Development (R&D) over the past five years? (Please list 
each year and the respective annual value).
    17. What percentage of your annual revenue has been spent on 
capital expenditures (CapEx) over the past five years? (Please list 
each year and the respective annual value).
    18. How often is capital expenditure (CapEx) funding usually needed 
(e.g., once every three years)?

Financing

    19. Have you previously used any form of U.S. Government funding? 
If so, please specify which funding tool(s) your company used and how 
(e.g., loans, loan guarantees, etc.). If not, please specify why.
    20. Have you ever accessed or attempted to obtain Federal credit 
(e.g., direct loans or loan guarantees) in the past, or are you 
considering it in the future? If so, please specify the Federal credit 
programs or institutions.
    21. Have Federal credit programs been able to successfully address 
the funding needs in your market segment? Please explain.
    22. Which types of debt financing are currently available to your 
company for the purposes of working capital, capital/equipment lease or 
purchases, and acquisition?
    23. What are the sources of debt financing in your market segment 
(e.g., Banks, Credit Unions, Non-Bank Lenders, Funds, etc.)?
    24. On average, how long does it take a company in your market 
segment to secure the needed debt funding for working capital, capital/
equipment purchases or leases, acquisitions, etc.? How critical is the 
speed of funding availability in your line of business?
    25. What are the typical terms for such debt instruments (e.g., 
debt/equity ratio, repayment tenor, fund availability period, grace 
period, amortization structure, security/collateral package, covenants, 
interest rates, credit spreads, etc.)?
    26. What are the limitations with existing forms of debt capital 
available to your company or sector (e.g., type, cost, availability, 
covenants, eligibility, etc.)?
    27. What are the typical debt instruments used to fund the 
procurement of the technology assets/equipment in your sector?
    28. What forms of working capital funding are available to 
companies in your market?
    29. Have you deferred production expansion due to lack of access to 
capital or the cost of capital?
    30. What is the seniority level of the typical debt instrument in 
your market? Are there any covenant restrictions preventing additional 
borrowing that is pari-passu or senior to existing debt on your balance 
sheet (if any)?
    31. What are some of the limitations or challenges in accessing 
funding in your sector?
    32. Are there any niche areas in your sub-sector that struggle with 
accessing the needed debt capital? Please describe the reasons for 
this.
    33. Would you benefit from OSC offering any of the following types 
of loan or loan guarantees: working capital loans or lines of credit, 
asset-backed loans, equipment financing, or acquisition financing?
    34. Subject to the criteria and eligibility requirements to be 
determined by OSC, what factors should OSC consider important when 
reviewing applications for the DoD Loan Program?

Economic Outlook

    35. What is your outlook on the five-year macroeconomic projection 
for your industry? What macroeconomic headwinds/tailwinds are most 
impacting you?

Competition

    36. Who are the main competitors in your space? Where are they 
located geographically? Please list the city and state, if known. If 
the competitor is located overseas, please list the city and country.
    37. Do you have foreign competition in your industry? Foreign 
competition is defined as a competing firm with headquarters outside of 
the United States. If yes, please list the firm(s) as well as the 
country they are headquartered in.
    38. Are you aware of or facing competition backed by foreign 
government financing? If so, please identify the competition and the 
type of foreign government financing provided.

Requirements for Written Comments

    OSC encourages respondents, when addressing the points above, 
unless raising other challenges related to financing Covered Technology 
Categories not explicitly asked, to identify which point they are 
responding to by using the same numbers and heading as set forth above. 
For example, someone submitting comments responsive to (9), ``What is 
your company's actual or implied Credit Rating Agency rating (e.g. BB+, 
Ba1, etc.)?'', would use that same text as a heading followed by the 
respondent's specific comments responding to it. This formatting will 
assist OSC in more easily reviewing and summarizing the comments 
received in response to these specific points of inquiry.
    Anyone submitting business confidential information should clearly 
identify the business confidential portion at the time of submission, 
file a statement justifying nondisclosure and referring to the specific 
legal authority claimed, and provide a non-confidential version of the 
submission. Users submitting a form that contains business confidential 
information will need to submit a non-confidential version of the same 
form that does not contain the confidential business information. The 
non-confidential version of the submission will be placed in the public 
file on https://www.regulations.gov. For comments submitted 
electronically containing business confidential information, the file 
name of the business confidential version should begin with the 
characters ``BC.'' Any

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page containing business confidential information must be clearly 
marked ``BUSINESS CONFIDENTIAL'' on the top of that page. The non-
confidential version must be clearly marked ``PUBLIC.'' The file name 
of the non-confidential version should begin with the character ``P.'' 
The ``BC'' and ``P'' should be followed by the name of the person or 
entity submitting the comments.

    Dated: July 18, 2024.
Aaron T. Siegel,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2024-16179 Filed 7-23-24; 8:45 am]
BILLING CODE 6001-FR-P