Venture Capital Act 2002
9‑10 Meaning of permitted loan9‑10 Meaning of permitted loan
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9‑10 Meaning of permitted loan
(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 *Industry Innovation and Science Australia allows under subsection (3). (2) A *general partner may apply to *Industry Innovation and Science Australia, in the *form approved by Industry Innovation and Science Australia, for Industry Innovation and Science Australia to allow a longer period for the purposes of paragraph (1)(b). (3) *Industry Innovation and Science Australia may, for the purposes of paragraph (1)(b), allow a longer period if Industry Innovation and Science Australia is satisfied that: (a) there are exceptional circumstances; and (b) the extended period is no longer than reasonably necessary.