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20 ILCS 3501/810-20

(20 ILCS 3501/810-20)

Sec. 810-20. Powers and Duties; Illinois Venture Investment Fund Limits.

The
Authority shall invest and reinvest the Fund and the income, thereof, in the
following ways:

(a) To make a direct investment in qualified securities issued by
enterprises
and to dispose of those securities within 10 years after the date of the direct
investment as determined by the Authority for the purpose of providing venture
capital or seed capital, provided that the investment shall not exceed 49% of
the estimated cost of development, testing, and initial production and
marketing
and associated working capital for the technology, product, process, or
invention, or $750,000, whichever is less;

(b) To enter into written agreements or contracts (including limited
partnership agreements) with one or more professional investors or one or more
seed capital investors, if any, for the purpose of establishing a pool of funds
to be used exclusively as venture capital or seed capital investments. The
Authority shall not invest more than $2,000,000 in a single pool of funds or
affiliated pools of funds.
The agreement or contract shall provide for the pool of funds to be managed by
a professional investor. The manager may be the general partner of a limited
partnership of which the Authority is a limited partner.
The agreement or contract may provide for reimbursement of expenses of, and
payment of a fee to, the manager. The agreement or contract may also provide
for payment to the manager of a percentage, not to exceed 40% (computed on an
annual basis), of cash and other property payable to the Authority as its
pro-rata share of distributions to investors in the pool of funds, provided
that (i)
no amount shall be received by the manager upon sale or other disposition of
qualified investments in enterprises until recovery by the Authority of its
investment and upon liquidation or withdrawal of the Authority from the pool of
funds, the manager shall be obligated to refund any amount received by it from
such percentage if necessary to allow the Authority to recover its investment
or
(ii) the terms of payment of cash and other property to the Authority are no
less favorable to the Authority than payments to other seed capital investors
(other than the manager) who are parties to the agreement or contract.

(c) To make co-venture investments by entering into agreements with one or
more
professional investors or one or more seed capital investors, if any, who have
formally agreed to invest at least 50% as much as the Authority invests in the
enterprise, for the purpose of providing venture capital or seed capital; but
no more than $1,000,000 shall be invested by the Authority in the qualified
securities of a single enterprise. A total of not more than $1,500,000 may be
invested in the securities of a single enterprise, if the Authority shall find,
after the initial investment by the Authority, that additional investments in
the enterprise are necessary to protect or enhance the initial investment of
the
Authority.
Each co-venture investment agreement shall provide that the Authority will
recover its investment before or simultaneously with any distribution to
participating professional investors or seed capital investors. The Authority
and participating professional investors and seed capital investors shall share
ratably in the profits earned in any form on the co-venture investment, but the
Authority may, at its discretion, agree to pay to a participating professional
investor a percentage, not to exceed 40% (computed on an annual basis), of cash
and other property payable to the Authority as its pro-rata share of
distributions to investors in the pool of funds, provided that (i) no amount
shall be received by the participating professional investor upon sale or other
disposition of qualified investments in the enterprises until recovery by the
Authority of its investment and upon liquidation or withdrawal of the Authority
from the pool of funds, the participating professional investor shall be
obligated to refund any amount received by it from such percentage if necessary
to allow the Authority to recover its investment or (ii) the terms of payment
of cash and other property to the Authority are no less favorable to the
Authority
than payments to other seed capital investors or professional investors (other
than the professional investor) who are parties to the agreement or contract;

(d) To purchase qualified securities of certified development corporations
created under
Section 503 of the federal Small Business Administration Act,
including the Illinois Small Business Growth Corporation, for the purpose of
making loans to enterprises that have the potential to create substantial
employment within the State per dollar invested by the Authority, provided that
the investment does not exceed 25% of the total investment in each corporation
at the time the investment is approved by the Authority. Investment by the
Authority in the Illinois Small Business Growth Corporation is not limited by
the foregoing provision;

(e) To purchase qualified securities of small business investment companies
and
minority enterprise small business investment corporations certified by the
federal Small Business Administration which are committed to making 60% of
their
investments in the State, provided that investments from the Fund do not exceed
25% of the total investment in these entities at the time the investment is
approved by the Authority;

(f) To make the investments of any funds held in reserves or sinking funds,
or any funds not required for immediate disbursement, as may be lawful
investments
for fiduciaries in the State;

(g) To facilitate and promote the acquisition and revitalization of existing
manufacturing enterprises by, at the Authority's discretion, developing and maintaining a list of firms, or
divisions thereof, located within the State that are available for purchase,
merger, or acquisition. The list may be made available at such charges as the
Authority may determine to all interested persons and institutions upon
request. No firm shall appear on the list without its prior written permission.
The list
may contain such additional financial, technical, market and other information
as may be supplied by the listed firm. The Authority shall bear no
responsibility for the accuracy of the information contained on the list, and
each listed firm shall hold the Authority harmless against any claim of
inaccuracy.
Enterprises supported by investments from the Fund may receive consideration
by the Authority in the allocation of loans to be insured or loans to be made
from the proceeds of bonds to be insured by the Industrial Revenue Bond
Insurance Fund established under this Article, and the
Authority may coordinate its activities under the 2 programs.

(Source: P.A. 97-789, eff. 7-13-12.)