§211G-13  Investment of capital.  (a) The corporation may solicit investment plans from investor groups for theinvestment of capital in accordance with this chapter.  The corporation shallestablish criteria for the selection of persons, firms, corporations, or otherentities.  The criteria shall include the applicant's level of experience,quality of management, investment philosophy and process, probability ofsuccess in fundraising, plan for achieving the purposes of this chapter, andsuch other investment criteria as may be used in professional portfoliomanagement that the corporation deems appropriate.  If the corporation decidesto engage one or more investor groups to deploy or generate capital, it shallconsider and select one or more investment plans and investor groups that thecorporation deems qualified to:

(1)  Generate capital for investment with the mosteffective and efficient use of the guarantee;

(2)  Invest the capital in private seed and venturecapital entities in a manner mobilizing a wide variety of equity andnear-equity investments in ventures promoting the economic development of theState; and

(3)  Help build a significant, fiscally strong, andpermanent resource to serve the objectives expressed in this chapter.

An investor group engaged by the corporationshall have a manager who is experienced in design and implementation, as wellas the management of seed and venture capital investment programs and incapital formation.  The corporation may remove and replace any investor groupthat has been engaged and effect the assignment of assets, liabilities,guarantees, and other contracts of this program to a new investor group,subject to such terms and conditions as may be set forth in the terms ofengagement.

(b)  With legislative approval pursuant tosection 211G-14, the corporation may extend one or more guarantees and securethe performance of such guarantees in the form of a put option, as well asother arrangements selected by the corporation.  Without limiting theforegoing:

(1)  The corporation may guarantee loans, lines ofcredit, and other indebtedness and equity investments and may arrange for,pledge, and assign put options, as well as other agreements to purchase taxcredits on such terms as the board may approve from time to time, in order togenerate funds to deploy in a manner consistent with this chapter;

(2)  The guarantees of loans, lines of credit, andother indebtedness may extend up to the principal amount plus interest over theterm of the guarantee at a rate set by board resolution from time to time, aguarantee of a loan, lines of credit, or other indebtedness in a mannerconsistent with this chapter; and

(3)  Guarantees of equity capital may extend up to theamount of the investment plus a rate of return set by board resolution fromtime to time in a manner consistent with this chapter.

Guarantees,in whatever form negotiated by the corporation, may be made for any period oftime, but no term shall expire prior to January 1, 2006.  The corporation maycharge a reasonable fee for costs and the fair compensation of risks associatedwith its guarantee.  Proceeds from the sale of any tax credits may be used tosatisfy the contractual guarantee obligation of the corporation.  Thecorporation may contract freely to protect the interest of the State.

(c)  If the corporation purchases any securitypursuant to an agreement with an investor group, the corporation shall acquirethe securities and may invest, manage, transfer, or dispose of the securitiesin accordance with policies for the management of assets adopted by thecorporation.

(d)  The corporation may make any contract,execute any document, charge reasonable fees for services rendered, perform anyact or enter into any financial or other transaction necessary to carry out itsmission.  The corporation may employ necessary staff as may be required for theproper implementation of this chapter, the management of its assets, or theperformance of any function authorized or required by this chapter necessaryfor the accomplishment of any such function.  Staff shall be selected by thecorporation based upon outstanding knowledge and leadership in the field forwhich the person performs services for the board.

(e)  In carrying out the mission of thecorporation, as authorized in this chapter, neither the corporation nor itsofficers, board members, or employees shall be considered to be broker-dealers,agents, investment advisors, or investment adviser representatives underchapter 485A.  The tax credits issued or transferred pursuant to this chaptershall not be considered securities under chapter 485A.

(f)  Funds raised or arranged by thecorporation pursuant to this chapter shall be invested in seed capital andventure capital investments, as such terms are defined in chapter 211F, which,to the extent consistent with this chapter, shall be governed by applicableprovisions of chapter 211F.

(g)  The guarantees extended by the fund shallbe payable solely from revenues of the fund and shall be secured solely bythose revenues and by the pledges and assignments authorized by this chapter. No holders of guarantees issued under this chapter shall have a right to compelany exercise of the taxing power of the State to pay the guarantees and nomoneys other than the revenues of the fund shall be applied to paymentthereof.  Each guarantee issued under this chapter shall recite in substancethat the guarantee is not a general obligation of the State and is payablesolely from revenues pledged to the payment thereof, and that such guarantee isnot secured directly or indirectly by the full faith and credit or the generalcredit of the State or by any revenues or taxes of the State other than therevenues specifically pledged thereto. [L 2004, c 215, pt of §1; am L 2007, c9, §10]