Section 1 adds the definition of “liquidation event” to mean a conversion of qualified investment for cash, cash and other consideration, or other form of debt or interest.
Section 2 adds two qualifications to the requirements for businesses to receive certification as a qualified small business. If it is engaged in research, development, or production of medical devices or pharmaceuticals requiring FDA approval, the business must not have been in operation for more than 20 years; and the business’ securities must not be publicly traded.
This section also adds criteria for a qualified investment in a business to be eligible for a tax credit. Its securities must not have been publicly traded and it must not issue publicly traded securities for 180 days subsequent to the date of the qualified investment; and the business must not have had a “liquidation event” within 180 days after the date of the qualified investment.
Section 3 provides that the mailing address, phone number, contact person, and type of industry of a qualified small business are public data for purposes of applications for certification of a qualified small business, certification of qualified investors, and certification of qualified funds. Currently, only the name of the qualified small business may be disclosed.
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