(a) "The article" means W.S. 9-12-1301 through 9-12-1312;
(b) "Fiscal year" means the twelve (12) month period that a company uses when reporting to the Internal Revenue Service;
(c) "Follow-on capital" means any additional investments of capital made in a qualified business that has received a qualified investment;
(d) "Headquartered" means an organization's principal office is located in Wyoming and at least sixty percent (60%) of the organization's employees are employed in Wyoming or 60% of the business payroll is paid to individuals living in Wyoming;
(e) "Liquid assets" means an investment that can be converted to cash in less than 20 days;
(f) "Person" means a natural person or entity, including a corporation, general or limited partnership, trust or limited liability company;
(g) "Principal office" means the main administrative functions of the organization and the original books and records are maintained in the Wyoming office;
(h) "Qualified debt instrument" means a debt instrument issued by a Wyoming small business investment company which: - (i) Is issued at par value or a premium;
- (ii) Has an original maturity date of at least four (4) years from the date of issuance and a repayment schedule which is not faster than a level principal amortization over four (4) years. A repayment schedule is not faster than a level principal amortization over four (4) years if the repayment schedule for the debt instrument issued by a Wyoming small business investment company has a scheduled outstanding principal balance greater than a hypothetical note with the same price and yield as the Wyoming small business investment company's debt instrument that provided for principal to be amortized over equal, consecutive daily payments, where payments are first allocated to accrued interest and then to principal. However, a participating investor may receive payments at any time for future earned interest, provided the amount received does not exceed the present value of that future interest payment, discounted by a factor that is not less than the stated interest rate of the debt instrument;
- (iii) Satisfies the rating criteria to qualify as "NAIC 1" as determined by the securities valuation office of the national association of insurance commissioners; and
- (iii) Has no interest, distribution or payment features that are related to the profitability of the Wyoming small business investment company or the performance of the Wyoming small business investment company's investment portfolio.
(j) "Qualified distribution" means any distribution or payment made by a Wyoming small business investment company in connection with: - (i) The costs and expenses of forming, syndicating and organizing the Wyoming small business investment company, including any fee paid for professional services, and the costs of financing and insuring the obligations of the Wyoming small business investment company provided that the distribution or payment is not made directly or indirectly to a participating investor, including:
- (A) That at the time the Wyoming small business investment company closes its investment from its participating investors and after deducting the aggregate of the costs of organizing, forming, syndicating, insuring and defeasing the obligations, the Wyoming small business investment company must have cash or other liquid assets available for qualified investments, in an amount equal to at least fifty percent (50%) of the amount of designated capital initially received from its participating investors.
- (ii) An annual management fee not to exceed three percent (3%) of designated capital on an annual basis to offset the costs and expenses of managing and operating a Wyoming small business investment company;
- (iii) Reasonable and necessary fees in accordance with industry custom for ongoing professional services, including, but not limited to, legal and accounting services related to the operation of a Wyoming small business investment company;
- (iv) An increase or projected increase in federal or state taxes, including penalties and related interest, of the equity owners of a Wyoming small business investment company resulting from the earnings or other tax liability of a Wyoming small business investment company to the extent that the increase is related to the ownership, management or operation of a Wyoming small business investment company; and
- (v) Payments of principal and interest to holders of qualified debt instruments issued by a Wyoming small business investment company.
(k) "Qualified Investment" means the investment of money by a Wyoming small business investment company in a qualified business for the purchase of any debt, debt participation, equity or hybrid security of any nature and description, including a debt instrument or security which has the characteristics of debt but provides for conversion into equity or equity participation instruments such as options or warrants, but shall not include any purchase of a guaranteed portion of a federally guaranteed loan; provided that the investment must not have a final stated maturity or be subject to mandatory redemption or repurchase prior to two (2) years from the date of initial investment and, provided further, that not more than fifty percent (50%) is used to refinance existing non-Wyoming small business investment company debt. Notwithstanding the foregoing, a qualified investment shall not include an investment that results, or could result, in a Wyoming small business investment company owning fifty percent (50%) or more of the voting or non-voting stock of a qualified business as evidenced by a proforma capitalization table presented to the Wyoming small business investment company, unless; - (i) Such ownership is the result of:
- (A) The Wyoming small business investment company's exercise of its rights and remedies following a default in the obligations of the qualified business;
- (B) The Wyoming small business investment company's exercise of preemptive rights granted to it in connection with its initial investment in a qualified business, provided such rights are exercised in connection with an investment in such qualified business by a party other than the Wyoming small business investment company or an affiliate of the Wyoming small business investment company;
- (C) The operation of any anti-dilution rights granted to a Wyoming small business investment company in connection with its initial investment in a qualified business; or
- (D) Such investment is approved by the Council prior to its being made.
(l) "Remaining uninvested designated capital" means the difference between designated capital and the cumulative amount of all qualified investments in qualified businesses.