Full Text of SB3205 100th General Assembly
SB3205enr 100TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning finance.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Technology Development Act is amended by | 5 | | changing Sections 5 and 11 as follows:
| 6 | | (30 ILCS 265/5)
| 7 | | Sec. 5. Policy. The Illinois General Assembly finds that it | 8 | | is important
for the
State to encourage technology development | 9 | | in the State. The purpose of this
Act is to
attract, assist, | 10 | | and retain quality technology businesses and promote the growth | 11 | | of jobs and entrepreneurial and venture capital environments in | 12 | | Illinois. The
creation of the
Technology Development Account | 13 | | will allow the State to bring together, and add
to,
Illinois'
| 14 | | rich science, technology, agricultural, financial, and | 15 | | business communities.
| 16 | | (Source: P.A. 92-851, eff. 8-26-02.)
| 17 | | (30 ILCS 265/11) | 18 | | Sec. 11. Technology Development Account II. | 19 | | (a) Including In addition to the amount provided in Section | 20 | | 10 of this Act, the State Treasurer shall may segregate a | 21 | | portion of the Treasurer's State investment portfolio, that at | 22 | | no time shall be greater than 5% 2% of the portfolio, in the |
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| 1 | | Technology Development Account IIa ("TDA IIa"), an account that | 2 | | shall be maintained separately and apart from other moneys | 3 | | invested by the Treasurer. Distributions from the investments | 4 | | in TDA IIa may be reinvested into TDA IIa without being counted | 5 | | against the 5% 2% cap. The aggregate investment in TDA IIa and | 6 | | the aggregate commitment of investment capital in a TDA | 7 | | II-Recipient Fund shall at no time be greater than 5% of the | 8 | | State's investment portfolio, which shall be calculated as: (1) | 9 | | the balance at the inception of the State's fiscal year; or (2) | 10 | | the average balance in the immediately preceding 5 fiscal | 11 | | years, whichever number is greater. Distributions from a TDA | 12 | | II-Recipient Fund, in an amount not to exceed the commitment | 13 | | amount, may be reinvested into TDA IIa without being counted | 14 | | against the 5% cap. The Treasurer may make investments from TDA | 15 | | IIa that help attract, assist, and retain quality technology | 16 | | businesses in Illinois. The earnings on TDA IIa shall be | 17 | | accounted for separately from other investments made by the | 18 | | Treasurer. | 19 | | (b) The Treasurer may solicit proposals from entities to | 20 | | manage and be the General Partner of a separate fund | 21 | | ("Technology Development Account IIb" or "TDA IIb") consisting | 22 | | of investments from private sector investors that must invest, | 23 | | at the direction of the general partner Treasurer , in tandem | 24 | | with TDA IIa in a pro-rata portion. The Treasurer may enter | 25 | | into an agreement with the entity managing TDA IIb to advise on | 26 | | the investment strategy of TDA IIa and TDA IIb (collectively |
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| 1 | | "Technology Development Account II" or "TDA II") and fulfill | 2 | | other mutually agreeable terms. Funds in TDA IIb shall be kept | 3 | | separate and apart from moneys in the State treasury. | 4 | | (c) All or a portion of the moneys Moneys in TDA IIa shall | 5 | | may be invested by the State Treasurer to provide venture | 6 | | capital to technology businesses , including co-investments, | 7 | | seeking to locate, expand, or remain in Illinois by placing | 8 | | money with Illinois venture capital firms for investment by the | 9 | | venture capital firms in technology businesses. "Venture | 10 | | capital", as used in this Section, means equity financing that | 11 | | is provided for starting up, expanding, or relocating a | 12 | | company, or related purposes such as financing for seed | 13 | | capital, research and development, introduction of a product or | 14 | | process into the marketplace, or similar needs requiring risk | 15 | | capital. "Technology business", as used in this Section, means | 16 | | a company that has as its principal function the providing of | 17 | | services, including computer, information transfer, | 18 | | communication, distribution, processing, administrative, | 19 | | laboratory, experimental, developmental, technical, or testing | 20 | | services ; , manufacture of goods or materials ; , the processing | 21 | | of goods or materials by physical or chemical change ; , computer | 22 | | related activities ; , robotics, biological , or pharmaceutical | 23 | | industrial activities; activity, or technology-oriented | 24 | | technology oriented or emerging industrial activity. "Illinois | 25 | | venture capital firm", as used in this Section, means an entity | 26 | | that : (1) has a majority of its employees in Illinois (more |
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| 1 | | than 50%) or that has at least one general managing partner or | 2 | | principal member of the general partner domiciled in Illinois, | 3 | | and that (2) provides equity financing for starting up or | 4 | | expanding a company, or related purposes such as financing for | 5 | | seed capital, research and development, introduction of a | 6 | | product or process into the marketplace, or similar needs | 7 | | requiring risk capital. "Illinois venture capital firm" may | 8 | | also mean an entity that has a track record of identifying, | 9 | | evaluating, and investing in Illinois companies and that | 10 | | provides equity financing for starting up or expanding a | 11 | | company, or related purposes such as financing for seed | 12 | | capital, research and development, introduction of a product or | 13 | | process into the marketplace, or similar needs requiring risk | 14 | | capital. For purposes of this Section, "track record" means | 15 | | having made, on average, at least one investment in an Illinois | 16 | | company in each of its funds if the Illinois venture capital | 17 | | firm has multiple funds or at least 2 investments in Illinois | 18 | | companies if the Illinois venture capital firm has only one | 19 | | fund. In no case shall more than 15% 10% of the capital in the | 20 | | TDA IIa be invested in firms based outside of Illinois. | 21 | | (d) Any fund created by an Illinois venture capital firm in | 22 | | which the State Treasurer places money pursuant to this Section | 23 | | shall be required by the State Treasurer to seek investments in | 24 | | technology businesses seeking to locate, expand, or remain in | 25 | | Illinois. Any fund created by an Illinois venture capital firm | 26 | | in which the State Treasurer places money under this Section |
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| 1 | | ("TDA II-Recipient Fund") shall invest a minimum of twice (2x) | 2 | | the aggregate amount of investable capital that is received | 3 | | from the State Treasurer under this Section in Illinois | 4 | | companies during the life of the fund. "Illinois companies", as | 5 | | used in this Section, are companies that are headquartered or | 6 | | that otherwise have a significant presence in the State at the | 7 | | time of initial or follow-on investment. Investable capital is | 8 | | calculated as committed capital, as defined in the firm's | 9 | | applicable fund's governing documents, less related estimated | 10 | | fees and expenses to be incurred during the life of the fund. | 11 | | For the purposes of this subsection (d), "significant presence" | 12 | | means at least one physical office and one full-time employee | 13 | | within the geographic borders of this State. | 14 | | Any TDA II-Recipient Fund shall also invest additional | 15 | | capital in Illinois companies during the life of the fund if, | 16 | | as determined by the fund's manager, the investment: | 17 | | (1) is consistent with the firm's fiduciary | 18 | | responsibility to its limited partners; | 19 | | (2) is consistent with the fund manager's investment | 20 | | strategy; and | 21 | | (3) demonstrates the potential to create risk-adjusted | 22 | | financial returns consistent with the fund manager's | 23 | | investment goals. | 24 | | In addition to any reporting requirements set forth in | 25 | | Section 10 of this Act, any TDA II-Recipient Fund shall report | 26 | | the following additional information to the Treasurer on a |
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| 1 | | quarterly or annual basis , as determined by the Treasurer, for | 2 | | all investments: | 3 | | (1) the names of portfolio companies invested in during | 4 | | the applicable investment period; | 5 | | (2) the addresses of reported portfolio companies; | 6 | | (3) the date of the initial (and follow-on) investment; | 7 | | (4) the cost of the investment; | 8 | | (5) the current fair market value of the investment; | 9 | | (6) for Illinois companies, the number of Illinois | 10 | | employees on the investment date; and | 11 | | (7) for Illinois companies, the current number of | 12 | | Illinois employees. | 13 | | If, as of the earlier to occur of (i) the fourth year of | 14 | | the investment period of any TDA II-Recipient Fund or (ii) when | 15 | | that TDA II-Recipient Fund has drawn more than 60% of the | 16 | | investable capital of all limited partners, that TDA | 17 | | II-Recipient Fund has failed to invest the minimum amount | 18 | | required under this subsection (d) in Illinois companies, then | 19 | | the Treasurer shall deliver written notice to the manager of | 20 | | that fund seeking compliance with the minimum amount | 21 | | requirement under this subsection (d). If, after 180 days of | 22 | | delivery of notice, the TDA II-Recipient Fund has still failed | 23 | | to invest the minimum amount required under this subsection (d) | 24 | | in Illinois companies, then the Treasurer may elect, in | 25 | | writing, to terminate any further commitment to make capital | 26 | | contributions to that fund which otherwise would have been made |
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| 1 | | under this Section. | 2 | | (e) Notwithstanding the limitation found in subsection (d) | 3 | | of Section 10 of this Act, the investment of the State | 4 | | Treasurer in any fund created by an Illinois venture capital | 5 | | firm in which the State Treasurer places money pursuant to this | 6 | | Section shall not exceed 15% of the total TDA IIa account | 7 | | balance investments in the fund . | 8 | | (f) (Blank). The State Treasurer shall not invest more than | 9 | | one-third of Technology Development Account II in any given | 10 | | calendar year. If in any calendar year less than one-third of | 11 | | Technology Development Account II is invested, 50% of the | 12 | | shortfall may be invested in the following calendar year in | 13 | | addition to the regular one-third investment. | 14 | | (g) The Treasurer may deposit no more than 10% of the | 15 | | earnings of the investments in the Technology Development | 16 | | Account IIa into the Technology Development Fund.
| 17 | | (Source: P.A. 97-197, eff. 7-25-11.)
| 18 | | Section 99. Effective date. This Act takes effect upon | 19 | | becoming law.
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