Florida Senate - 2007                      COMMITTEE AMENDMENT
    Bill No. CS for CS for SB 2420
                        Barcode 701998
                            CHAMBER ACTION
              Senate                               House
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       04/13/2007 01:10 PM         .                    
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11  The Committee on Finance and Tax (Haridopolos) recommended the
12  following amendment:
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14         Senate Amendment (with title amendment) 
15         Delete everything after the enacting clause
16  
17  and insert:  
18         Section 1.  Sections 288.9621, 288.9622, 288.9623,
19  288.9624, and 288.9625, Florida Statutes, are created to read:
20         288.9621  Short title.--Sections 288.9621-288.9625 may
21  be cited as the "SURE Venture Capital Act."
22         288.9622  Findings and intent.--
23         (1)  The Legislature finds and declares that there is a
24  need to increase the availability of seed capital and early
25  stage venture equity capital for emerging companies in this
26  state which are commercializing university research,
27  technology, or patents, or commercializing any other
28  state-supported research organization's technology, products,
29  or patents, including, without limitation, enterprises in life
30  sciences, information technology, advanced manufacturing
31  processes, aviation and aerospace, and homeland security and
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Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 defense, as well as other strategic technologies. 2 (2) It is the intent of the Legislature that ss. 3 288.9621-288.9625 serve to mobilize investment in a broad 4 variety of Florida-based, new technology companies within 5 diversified industries; retain private-sector-investment 6 criteria focused on rate of return; use the services of a 7 highly qualified manager in the venture capital industry; 8 facilitate the organization of the SURE Venture Capital Fund 9 as a coinvestor in seed and early stage companies; market 10 products developed in universities and publicly funded 11 entities located in this state; and precipitate capital 12 investment and extensions of credit to and in the SURE Venture 13 Capital Fund. It is the further intent of the Legislature that 14 an institute be created to mentor, market, and attract capital 15 to such commercialization ventures throughout the state of 16 Florida. 17 (3) It is the intent of the Legislature to mobilize 18 venture equity capital for investment in a manner that results 19 in a significant potential to create new businesses and jobs 20 throughout this state which are based on high-growth-potential 21 technologies, products, or services and which will further 22 diversify the economy of this state. 23 288.9623 Definitions.--As used in ss. 24 288.9621-288.9625: 25 (1) "Designated investor" means a person, other than 26 the board, who purchases an equity interest in the SURE 27 Venture Capital Fund, or who is a party to a certificate, or 28 who is a lender to the SURE Venture Capital Fund. 29 (2) "SURE Venture Capital Fund" or "fund" means the 30 private, not-for-profit corporation in which a designated 31 investor purchases an equity interest or to which a designated 2 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 investor extends credit. 2 (3) "SURE Fund Board" or "directorate" means the board 3 of directors of the SURE Venture Capital Fund. 4 288.9624 SURE Venture Capital Fund.-- 5 (1)(a) Enterprise Florida, Inc., shall facilitate the 6 creation of the SURE Venture Capital Fund, a private, 7 not-for-profit corporation organized and operated under 8 chapter 617. Enterprise Florida, Inc., shall be the 9 corporation's sole shareholder or member. The corporation is 10 not a public corporation or instrumentality of the state. 11 (b) The purpose of the SURE Venture Capital Fund is to 12 select an early stage venture capital investment advisor, 13 negotiate for investment capital or loan proceeds from 14 private, institutional, or banking sources, and coinvest 15 capital in companies in this state which are accepted into or 16 promoted by the Institute for the Commercialization of Public 17 Research. The fund shall manage its business affairs and 18 conduct business consistent with its organizational documents 19 and the purposes set forth in this section. Notwithstanding 20 the powers granted under chapter 617, the corporation may not 21 amend, modify, or repeal a bylaw or article of incorporation 22 without the express written consent of Enterprise Florida, 23 Inc. 24 (2)(a) The vice chair of Enterprise Florida, Inc., 25 shall select from among its sitting board of directors a 26 five-person appointment committee. The appointment committee 27 shall select five initial members of a board of directors for 28 the fund. 29 (b) The persons elected to the initial board of 30 directors by the appointment committee shall include persons 31 who have expertise in the area of the selection and 3 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 supervision of early stage investment managers or in the 2 fiduciary management of investment funds and other areas of 3 expertise as considered appropriate by the appointment 4 committee. 5 (c) After election of the initial board of directors, 6 vacancies on the board shall be filled by vote of the board of 7 directors of Enterprise Florida, Inc., and board members shall 8 serve terms as provided in the fund's organizational 9 documents. 10 (d) Members of the board are subject to any 11 restrictions on conflicts of interest specified in the 12 organizational documents and may not have an interest in any 13 venture capital investment selected by the corporation under 14 ss. 288.9621-288.9625. 15 (3) The board shall organize the SURE Venture Capital 16 Fund, select an early stage venture capital investment 17 manager, negotiate the terms of a contract with the SURE 18 Venture Capital Fund investment manager, execute the contract 19 with the selected venture capital investment fund manager on 20 behalf of the SURE Venture Capital Fund, manage the business 21 affairs of the SURE Venture Capital Fund, such as accounting, 22 audit, insurance, and related requirements, solicit and 23 negotiate the terms, contract for and receive investment 24 capital and loan proceeds with the assistance of the 25 investment manager, receive investment returns, pay investors 26 and debtors, and reinvest the investment returns in the fund 27 in order to provide additional venture capital investments 28 designed to result in a significant potential to create new 29 businesses and jobs in this state and further diversify the 30 economy of this state. 31 (4) Upon organization, the directorate shall conduct a 4 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 national solicitation for investment plan proposals from 2 qualified venture capital investment managers for the raising 3 and investing of capital by the SURE Venture Capital Fund. Any 4 proposed investment plan must address the applicant's level of 5 experience, quality of management, investment philosophy and 6 process, provability of success in fundraising, prior 7 investment fund results, and plan for achieving the purposes 8 of this act. The board shall select only venture capital 9 investment managers having demonstrated expertise in the 10 management of and investment in companies. 11 (5) A member of the board of directors shall receive 12 no compensation for his or her services, but is entitled to 13 receive reimbursement for necessary expenses, including travel 14 and per diem expenses, incurred in the performance of his or 15 her duties. 16 (6) The fund shall have all powers granted under its 17 organizational documents and shall indemnify members to the 18 broadest extent permissible under the laws of this state. 19 (7)(a) The fund may negotiate any and all terms and 20 conditions for its investments. 21 (b) The fund shall invest directly only in companies 22 in this state which are accepted into or promoted by the 23 Institute for the Commercialization of Public Research. The 24 fund shall invest only if additional private capital is 25 invested in an amount equal to or greater than the investment 26 of the fund, only if the fund's reasonable due diligence 27 determines that the company is viable and has prospects for 28 profitable operations, and only if the company has manifested 29 its intent to remain located in this state. Not more than 15 30 percent of the fund's accessible capital may be invested in 31 one company project. 5 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 (8) If the fund is liquidated or has returned all 2 capital to designated investors in accordance with contractual 3 agreements, or if the guarantee capacity of the corporation, 4 at the sole discretion of the board, is sufficient for 5 additional certificates, a new funding of the SURE Venture 6 Capital Fund may be implemented for subsequent venture capital 7 investments. If the board takes exception to an additional 8 funding, such additional funding may be implemented only 9 without the benefit of certificates from the board. 10 (9) By December 1 of each year, the directorate shall 11 issue an annual report concerning the activities conducted by 12 the SURE Venture Capital Fund to the Governor, the President 13 of the Senate, and the Speaker of the House of 14 Representatives. The annual report, at a minimum, must 15 include: 16 (a) An accounting of the amount of grants and 17 proposals awarded and disbursed during the preceding fiscal 18 year by project and university. 19 (b) Information concerning the amount and nature of 20 economic activity in this state generated through university 21 and other state-supported research projects receiving funding 22 from the fund. 23 (c) Project summaries of the information reported by 24 grant recipients in paragraph (b). 25 (d) A description of the benefits to this state 26 resulting from the program, including the number of businesses 27 created, associated industries started, and the growth of 28 related research projects. 29 (e) Independently audited financial statements, 30 including statements that show receipts and expenditures 31 during the preceding fiscal year for personnel, 6 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 administration, and operational costs of the fund. 2 (f) A description of those projects supported by the 3 fund in which two or more universities are working 4 cooperatively to avoid duplicating activities, programs, and 5 functions and to leverage the expertise offered by other 6 universities. 7 288.9625 Institute for the Commercialization of Public 8 Research.--There is established the Institute for the 9 Commercialization of Public Research. 10 (1) The institute shall be a not-for-profit 11 corporation registered, incorporated, and operated in 12 accordance with chapter 617. 13 (2) The purpose of the institute is to assist in the 14 commercialization of products developed by the research and 15 development activities of universities and colleges, research 16 institutes, and publicly supported organizations within the 17 state. The institute shall operate to fulfill its purpose and 18 in the best interests of the state. The institute: 19 (a) Shall be a corporation primarily acting as an 20 instrumentality of the state, pursuant to s. 768.28(2), for 21 the purposes of sovereign immunity; 22 (b) Is not an agency within the meaning of s. 23 20.03(11); 24 (c) Is subject to the open records and meetings 25 requirements of s. 24, Art. I of the State Constitution, 26 chapter 119, and s. 286.011; 27 (d) Is not subject to the provisions of chapter 287; 28 (e) Shall be governed by the code of ethics for public 29 officers and employees as set forth in part III of chapter 30 112; 31 (f) Is not authorized to create corporate 7 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 subsidiaries; 2 (g) Shall support existing commercialization efforts 3 at Florida universities; and 4 (h) May not supplant, replace, or direct existing 5 technology transfer operations or other commercialization 6 programs, including incubators and accelerators. 7 (3) The articles of incorporation of the institute 8 must be approved in a written agreement with Enterprise 9 Florida, Inc. The agreement and the articles of incorporation 10 shall: 11 (a) Provide that the corporation shall provide equal 12 employment opportunities for all persons regardless of race, 13 color, religion, gender, national origin, age, handicap, or 14 marital status; 15 (b) Provide that the corporation is subject to the 16 public records and meeting requirements of s. 24, Art. I of 17 the State Constitution; 18 (c) Provide that all officers, directors, and 19 employees of the corporation shall be governed by the code of 20 ethics for public officers and employees as set forth in part 21 III of chapter 112; 22 (d) Provide that members of the board of directors of 23 the corporation are responsible for the prudent use of all 24 public and private funds and that they will ensure that the 25 use of funds is in accordance with all applicable laws, 26 bylaws, and contractual requirements; and 27 (e) Provide that the fiscal year of the corporation is 28 from July 1 to June 30. 29 (4) The affairs of the corporation shall be managed by 30 a board of directors who shall serve without compensation. 31 Each director shall have only one vote. The chair of the board 8 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 of directors shall be selected by a majority vote of the 2 directors, a quorum being present. The board of directors 3 shall consist of the following five members: 4 (a) The chair of Enterprise Florida, Inc., or the 5 chair's designee. 6 (b) The president of the university where the 7 institute is located or the president's designee unless 8 multiple universities jointly sponsor the institute, in which 9 case the presidents of the sponsoring universities shall agree 10 upon a designee. 11 (c) Three directors appointed by the Governor to 12 3-year staggered terms, to which directors may be reappointed. 13 (5) The board shall provide a copy of the institute's 14 annual report to the Governor, the President of the Senate, 15 the Speaker of the House of Representatives, Enterprise 16 Florida, Inc., and the president of the university at which 17 the institute is located. 18 (6) Enterprise Florida, Inc., the president and the 19 board of trustees of the university where the institute is 20 located, the Auditor General, and the Office of Program Policy 21 Analysis and Government Accountability may require and receive 22 from the institute or its independent auditor any detail or 23 supplemental data relative to the operation of the 24 corporation. 25 (7) Enterprise Florida, Inc., shall issue a request 26 for proposals to public universities in Florida requesting 27 proposals to fulfill the purposes of the institute as 28 described in this section and provide for its physical 29 location in a major metropolitan area in the southern part of 30 the state having extensive commercial air service to 31 facilitate access by Venture Capital providers. Enterprise 9 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 Florida, Inc., shall review the proposals in a committee 2 appointed by its board of directors which shall make a 3 recommendation for final selection. Final approval of the 4 selected proposal must be by the board of directors of 5 Enterprise Florida, Inc., at one of its duly noticed meetings. 6 (a) To be eligible for assistance, the company or 7 organization attempting to commercialize its product must be 8 accepted by the institute before receiving the institute's 9 assistance. 10 (b) The institute shall receive recommendations from 11 any publicly supported organization that a company that is 12 commercializing the research, technology, or patents from a 13 qualifying publicly supported organization should be accepted 14 into the institute. 15 (c) The institute shall thereafter review the business 16 plans and technology information of each such recommended 17 company. If accepted, the institute shall mentor the company, 18 develop marketing information on the company, and use its 19 resources to attract capital investment into the company, as 20 well as bring other resources to the company which may foster 21 its effective management, growth, capitalization, technology 22 protection, marketing or business success. 23 (8) The institute shall: 24 (a) Maintain a centralized location to showcase 25 companies and their technologies and products; 26 (b) Develop an efficient process to inventory and 27 publicize companies and products that have been accepted by 28 the institute for commercialization; 29 (c) Routinely communicate with private investors and 30 venture capital organizations regarding the investment 31 opportunities in its showcased companies; 10 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 (d) Facilitate meetings between prospective investors 2 and eligible organizations in the institute; 3 (e) Hire full-time staff who understand relevant 4 technologies needed to market companies to the angel investors 5 and venture capital investment community; 6 (f) Operate within an allocated annual budget of $1 7 million or less; and 8 (g) Develop cooperative relationships with publicly 9 supported organizations all of which work together to provide 10 resources or special knowledge that is likely to be helpful to 11 institute companies. 12 (9) The institute may not develop or accrue any 13 ownership, royalty, patent, or other such rights over or 14 interest in companies or products in the institute and shall 15 maintain the secrecy of proprietary information. 16 (10) The institute may not charge for services 17 rendered to state universities and affiliated organizations, 18 community colleges, or state agencies. 19 Section 2. The nonrecurring sum of $700,000 is 20 appropriated from the General Revenue Fund to the SURE Venture 21 Capital Fund for the purpose of initiating activities 22 necessary to implement its responsibilities under this act for 23 the 2007-2008 fiscal year. 24 Section 3. The nonrecurring sum of $100,000 is 25 appropriated to Enterprise Florida, Inc., and the nonrecurring 26 sum of $900,000 is appropriated from the General Revenue Fund 27 to the Institute for the Commercialization of Public Research 28 for the purpose of initiating activities necessary to 29 implement its responsibilities under this act for the 30 2007-2008 fiscal year. 31 Section 4. The nonrecurring sum of $38.3 million is 11 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 appropriated from the General Revenue Fund to Enterprise 2 Florida, Inc., for the SURE Venture Capital Fund for the 3 purpose of making investments under s. 288.9626, Florida 4 Statutes, for the 2007-2008 fiscal year. 5 Section 5. This act shall take effect July 1, 2007. 6 7 8 ================ T I T L E A M E N D M E N T =============== 9 And the title is amended as follows: 10 Delete everything before the enacting clause 11 12 and insert: 13 A bill to be entitled 14 An act relating to venture capital funds; 15 creating s. 288.9621, F.S.; providing a short 16 title; creating s. 288.9622, F.S.; providing 17 legislative findings and intent; creating s. 18 288.9623, F.S.; providing definitions; creating 19 s. 288.9624, F.S.; requiring Enterprise 20 Florida, Inc., to facilitate establishment of 21 the SURE Venture Capital Fund; specifying 22 criteria of the fund; providing for appointment 23 of a board of trustees selection committee; 24 providing for selection of a board of directors 25 of the fund by Enterprise Florida, Inc.; 26 specifying criteria; providing for terms and 27 requirements of the directors; providing 28 purposes of the fund; providing duties and 29 responsibilities of the fund; authorizing the 30 fund to charge a management fee for certain 31 purposes; providing for reimbursement for 12 8:30 AM 04/12/07 s2420c2d-ft26-tm9
Florida Senate - 2007 COMMITTEE AMENDMENT Bill No. CS for CS for SB 2420 Barcode 701998 1 travel and other direct expenses; providing for 2 powers of the fund; providing investment 3 requirements for the fund; requiring the board 4 of directors to issue an annual report on the 5 activities of the fund; providing report 6 requirements; creating s. 288.9625, F.S.; 7 creating the Institute for the 8 Commercialization of Public Research; providing 9 that the institute is a not-for-profit 10 corporation; providing that the purpose of the 11 institute is to commercialize the products of 12 public research; providing for membership of 13 the board of directors; requiring the institute 14 to provide data to certain entities; providing 15 responsibilities of the institute; prohibiting 16 the institute from having any interest in any 17 product supported by the institute; providing 18 appropriations; providing an effective date. 19 20 21 22 23 24 25 26 27 28 29 30 31 13 8:30 AM 04/12/07 s2420c2d-ft26-tm9