Commonwealth Consolidated Acts

VENTURE CAPITAL ACT 2002 - SECT 9.10

             (1)  A debt interest is a permitted loan if:

                     (a)  it is a loan made to a * company and the sum of:

                              (i)  the * equity interests that the partnership owns in the company; and

                             (ii)  any debt interests that the partnership owns in the company that can be converted into equity interests in the company;

                            is at least 10% of the sum of:

                            (iii)  all of the equity interests in the company; and

                            (iv)  all of the debt interests in the company that can be converted into equity interests in the company;

                            and the company meets the requirements of subsections 118-425(2) to (7) of the Income Tax Assessment Act 1997 in relation to the investments referred to in subparagraphs (i) and (ii); or

                    (aa)  it is a loan made to a unit trust and the sum of:

                              (i)  the * equity interests that the partnership owns in the unit trust; and

                             (ii)  any * debt interests that the partnership owns in the unit trust that can be converted into equity interests in the unit trust;

                            is at least 10% of the sum of:

                            (iii)  all of the equity interests in the unit trust; and

                            (iv)  all of the debt interests in the unit trust that can be converted into equity interests in the unit trust;

                            and the unit trust meets the requirements of subsections 118-427(3) to (8) of the Income Tax Assessment Act 1997 in relation to the investments referred to in subparagraphs (i) and (ii); or

                     (b)  it is repaid within 6 months, or such longer period as * Innovation Australia allows under subsection (3).

             (2)  A * general partner may apply to * Innovation Australia, in the * form approved by Innovation Australia, for Innovation Australia to allow a longer period for the purposes of paragraph (1)(b).

             (3)  * Innovation Australia may, for the purposes of paragraph (1)(b), allow a longer period if Innovation Australia is satisfied that:

                     (a)  there are exceptional circumstances; and

                     (b)  the extended period is no longer than reasonably necessary.