Section 355.340 - Placement of investments and co-investments; commitment of money for investment opportunities; policies and procedures governing investments1. Subject to the requirements of this section, upon the approval of a majority of the members of the Board currently serving, with the State Treasurer being in the majority, the Corporation shall: (a) Place direct investments and co-investments with companies, strategic investors, private equity funds, venture capital funds and other fund managers.(b) Commit money for unique private equity investment opportunities in this State.2. The Board shall adopt policies and procedures governing investments made pursuant to this section. Any investment made pursuant to this section must comply with the policies and procedures adopted pursuant to this subsection. At a minimum, the policies and procedures must establish due diligence controls that provide reasonable assurance that any investments pursuant to this section are likely to meet the investment performance objectives of the Corporation. The due diligence controls may include, without limitation:(a) Entering into a contract with an investment advisor, investment consultant or any other person to evaluate an opportunity for an investment pursuant to this section. The Corporation may not enter into such a contract with an investment advisor, investment consultant or other person who has a business or familial relationship with a member of the Board or the management of a fund or business being evaluated or whose independence of judgment may reasonably be affected by a commitment to the interests of another person.(b) Entering into a partnership with an institutional investor that has invested in the opportunity pursuant to which the Corporation and the institutional investor share analytical resources.(c) Establishing requirements for the due diligence efforts of the State Treasurer's staff and any subcommittees of the Board that perform due diligence for investments made pursuant to this section.3. Any investments made pursuant to this section must be based on the following criteria: (a) Primarily, the probability that a business will succeed and the expected investment return; and(b) Secondarily, the diversification of the economic base of this State and the generation and retention of jobs and investment in this State.4. In making investments with companies, strategic investors, private equity funds, venture capital funds and other fund managers pursuant to this section, the Board shall: (a) Prioritize direct investments and co-investments with companies, strategic investors, private equity funds, venture capital funds and other fund managers that are seeking to expand existing businesses within this State or cause new businesses to relocate to this State that:(1) Are engaged in technology, hospitality and gaming, renewable energy, advanced manufacturing or infrastructure or any other industry that has been identified by the Office of Economic Development as part of the economic development strategy for this State; or(2) Compensate employees at a rate above the median income in this State and provide adequate health insurance coverage to employees.(b) To the extent that funds are available, work to prioritize follow-on rounds of investments for a direct investment or co-investment made by the Board with a company, strategic investor, private equity fund, venture capital fund or other fund manager that has exceeded investment benchmarks, as determined by the Board.(c) Ensure that 100 percent of the venture capital direct investments and co-investments of the Corporation are made in businesses that meet the criteria set forth in subsection 6 of NRS 355.285.(d) Ensure that a business relocating to this State and receiving a venture capital direct investment or co-investment is required to:(1) Maintain a presence in this State, as evidenced by the criteria set forth in subsection 6 of NRS 355.285, for a minimum period; and(2) Pay back any investment made by the Corporation if the business fails to maintain such a presence for the minimum period.(e) Ensure that more than 50 percent of the private equity funding provided by the Corporation, after the payment of fees to investment managers, is provided to businesses that meet the criteria set forth in subsection 2 of NRS 355.280, as amended by section 4 of Assembly Bill No. 33, chapter 175, Statutes of Nevada 2023, at page 1034.5. Any company, strategic investor, private equity fund, venture capital fund or other fund manager with which the Board elects to make a direct investment or co-investment pursuant to this section shall: (a) Prepare a draft of the annual report required by paragraph (d) of subsection 7 of NRS 355.270 and submit the draft to the officers of the Corporation for review. The officers of the Corporation shall review the draft of the report and submit it to the Board for approval. The report must provide:(1) An accounting of all money received and expended by the Corporation, including, without limitation, any grants, gifts or donations received by the Corporation; and(2) The name and a brief description of all funds receiving an investment from the Corporation.(b) Perform any other duties established by the contract between the Corporation and the company, strategic investor, private equity fund, venture capital fund or other fund manager.Nev. Admin. Code § 355.340
Added to NAC by St. Treasurer by R128-11, eff. 2-20-2013; A by R046-23A, eff. 1/5/2024