§ 51:1923 — Definitions

Louisiana § 51:1923

• Jurisdiction: Louisiana
• Title 51: Trade and Commerce

Text

§1923. Definitions
For the purposes of this Chapter, the following terms shall have the meanings
provided in this Section, unless the context clearly indicates otherwise:
(1) "Approved technology-based businesses" means any qualified Louisiana business
that is a qualified Louisiana technology-based business, the investment in which is approved
in writing by at least two of the Louisiana research parks at the time.
(2) "Certified capital" means an investment pursuant to R.S. 51:1924(A) and (B) or
an investment pursuant to R.S. 22:832(E) into a certified Louisiana capital company.
(3) "Certified Louisiana capital company" means any partnership, corporation, or
other legal entity, whether organized on a profit or nonprofit basis, that has as its primary
business activity the investment of cash in such a manner as to acquire equity in or provide
financing assistance as a licensed business and industrial development corporation to
qualified Louisiana businesses that are in need of capital for survival, expansion, new
product development, or similar business purposes and that is certified by the commissioner
of the office of financial institutions, as meeting the criteria of this Chapter and thus eligible
for the tax credit provided in this Chapter.
(4) "Certified Louisiana capital company group" means any one or more certified
Louisiana capital companies which share common management or are under common
control, whether such management or control is accomplished directly or indirectly.
(5) "Commissioner" means the commissioner of the Office of Financial Institutions
within the office of the governor.
(6) "Department" means Louisiana Economic Development.
(7) "Disadvantaged business" means, with respect to all investment pools certified
after January 1, 2002, any qualified Louisiana business that has its headquarters located, at
the time of investment, in a low-income community, as such term is defined in Section
45(D)(e) of the Internal Revenue Code of 1986, as amended.
(8) "Equity in a qualified Louisiana business" is defined as an interest that in
substance and in form is either:
(a) Common stock, preferred stock, or an equivalent ownership interest in a limited
liability company, partnership, or other entity.
(b) A loan with a stated maturity of not less than five years which provides for
conversion into equity at a future date or has equity features. The department shall
promulgate rules to determine what constitutes equity features for the purpose of this
definition.
(9) "Investment date" means, with respect to each investment pool, the date on which
the investment pool transaction closes.
(10) "Investment pool" means the aggregate of all investments of certified capital in
a particular certified Louisiana capital company which are made as part of the same
transaction.
(11)(a) "Louisiana research park" means any property-based venture located in the
state of Louisiana which has all of the following elements:
(i) Existing or planned land and buildings designed primarily for private and public
research and development facilities, high technology and science-based companies, and
support services.
(ii) A contractual and/or formal ownership or operational relationship with one or
more universities or other institutions of higher education and science research.
(iii) A role in promoting research and development by the university in partnership
with industry, assisting in the growth of new ventures, and promoting economic
development.
(iv) A role in aiding the transfer of technology and business skills between the
university and industry tenants.
(b) A Louisiana research park may be a not-for-profit or for-profit entity owned
wholly or partially by a university or a university-related entity. Alternatively, a Louisiana
research park may be owned by a non-university entity but have a contractual or other formal
relationship with a university, including joint or cooperative ventures between a privately
developed research park and a university.
(12) "Qualified investment" means:
An investment that in substance and in form furthers economic development within
Louisiana as defined by rule and is either:
(a)(i) A transaction that consists of the investment of cash and results in the
acquisition of equity in a qualified Louisiana business; or
(ii) Financing assistance provided in cash to a qualified Louisiana business by a
business and industrial development corporation licensed pursuant to the Louisiana Business
and Industrial Development Corporation Act, R.S. 51:2386 et seq.
(b) An equity investment or debt investment which has a stated final maturity date
of not less than five years from the origination of the debt investment in a qualified venture
fund approved by the secretary.
(c) An equity or debt investment in a Louisiana-based economic development
infrastructure project approved by the secretary.
(d) An equity or debt investment in a qualified technology fund approved by the
secretary.
(13)(a) "Qualified Louisiana business" means a business that at the time of
investment meets, or, as the direct result of an investment pursuant to this Chapter would
meet, each of the following requirements:
(i) Operates primarily in Louisiana or performs substantially all of its production in
Louisiana, or is headquartered in Louisiana with a substantial portion of its assets located in
Louisiana and which is in need of capital and is involved in commerce for the purpose of
retail, or the manufacturing, processing, or assembling of products, or conducting research
and development, or providing services, provided that at least eighty percent of the total
employees of such business shall be domiciled in the state of Louisiana and that at least
eighty percent of the payroll of such business shall be paid to such employees.
(ii) Has, together with its affiliates, a net worth which is not in excess of eighteen
million dollars.
(iii) Has, together with its affiliates, an average annual net income, after federal
income taxes, excluding any carry-over losses, for the preceding two completed fiscal years
which is not in excess of six million dollars.
(iv) Has, together with its affiliates, no more than five hundred employees.
(b) Any business, which is classified as a qualified Louisiana business at the time of
the first investment in said business by a certified Louisiana capital company, shall remain
classified as a qualified Louisiana business for any later additional investment into the
business by that certified Louisiana capital company, provided each additional investment
meets the definition of a qualified investment.
(14) "Qualified Louisiana startup business" means any qualified Louisiana business
that is in development or has been operational for less than two years and is in need of capital
for pre-startup, startup, survival, expansion, new product development, or similar business
purpose or that is determined by the secretary as meeting the criteria of this Paragraph.
(15) "Qualified Louisiana technology-based business" means any qualified Louisiana
business that is in need of capital for pre-startup, startup, survival, expansion stage, new
product development, or similar business purpose that is engaged in or intends to provide
technology-based products or services in information technology, communications, medical,
biomedical, advanced materials, food, environmental, micro-manufacturing technologies, or
that is determined by the secretary as meeting the criteria of this Paragraph.
(16) "Qualified technology fund" means any venture capital or private equity fund
that meets all of the following criteria:
(a) The fund is managed or proposed to be managed directly or indirectly with
representation from any of the following Louisiana research parks that elects to provide such
representation: the Louisiana Technology Park in Baton Rouge, the University of New
Orleans Research and Technology Park in New Orleans, the University Research Park in
Lafayette and the InterTech Science Park in Shreveport; or any other technology parks
certified by the secretary.
(b) The fund agrees to make all of the investments made by it with the proceeds of
any investment from a certified Louisiana capital company in qualified Louisiana
technology-based businesses.
(c) The investment policy of the qualified technology fund shall expressly provide
that investments from the qualified technology fund may be made in qualified businesses
located anywhere within the state of Louisiana.
(d) The fund agrees that the commissioner shall regulate the investment of the
certified capital received by the qualified technology fund pursuant to rules promulgated by
the secretary.
(17) "Qualified venture fund" means any certified Louisiana capital company that
is designated a specialty business and industrial development corporation as defined in this
Section and which is further certified by the secretary as meeting all of the following criteria:
(a) The fund's primary investment objectives include investing in Louisiana
businesses in amounts not exceeding one million dollars.
(b) The fund agrees to make all of the investments made by it with the proceeds of
any investment from a certified Louisiana capital company in qualified Louisiana businesses.
(c) A qualified venture fund shall not be an affiliate of a certified capital company
that invests in a qualified venture fund.
(d) A qualified venture fund shall not have raised directly or combined with its
affiliates more than ten million in certified capital, excluding any funds invested by a
certified capital company as a qualified investment in a qualified venture fund pursuant to
this Chapter. For purposes of this definition "affiliate" means a person or legal entity
controlling, controlled by or under common control with, another person or legal entity,
directly or indirectly through one or more intermediaries.
(e) The fund shall agree that the commissioner shall regulate the investment of the
certified capital received by the qualified venture fund pursuant to rules promulgated by the
secretary.
(18) "Research park early stage business" means any qualified Louisiana business
that is a qualified Louisiana startup business which receives assistance from or has its
principal place of business located at a Louisiana research park.
(19) "Secretary" means the secretary of Louisiana Economic Development.
(20) "Specialty business and industrial development corporation" means any business
and industrial development corporation licensed after January 1, 2002, and approved by the
secretary as meeting one or more of the following criteria:
(a) A business and industrial development corporation that provides more than fifty
percent of its qualified investments in businesses that are fifty-one percent owned or
controlled by minorities or women.
(b) A business and industrial development corporation that provides more than fifty
percent of its qualified investments in disadvantaged businesses.
(c) A business and industrial development corporation that is a nonprofit corporation
providing more than fifty percent of its qualified investments in disadvantaged businesses
or to businesses that are more than fifty percent owned or controlled by minorities or women.
(d) A business and industrial development corporation that is more than fifty percent
owned or controlled in its daily operation by minorities or women. For purposes of this
Subparagraph, any business and industrial development corporation that has been designated
as a specialty business and industrial development corporation by the secretary prior to
January 1, 2002, shall be considered a specialty business and industrial development
corporation for purposes of this Section.

Legislative History

Acts 1983, No. 642, §1; Acts 1989, No. 496, §1; Acts 1993, No. 279, §2, eff. June 2, 1993; Acts 1996, No. 21, §2, eff. June 27, 1996; Acts 2001, No. 8, §17, eff. July 1, 2001; Acts 2001, No. 9, §9, eff. July 1, 2001; Acts 2001, No. 1122, §1, eff. July 1, 2001; Acts 2002, No. 84, §2, eff. June 25, 2002; Acts 2008, No. 415, §2, eff. Jan. 1, 2009.