KRS § 164.6021 — KY Code / Title XIII / Chapter 164 / Section 164.6021
164.6021 Purposes and administration of Kentucky enterprise fund
Status: in_force

164.6021 Purposes and administration of Kentucky enterprise fund.

(1) The Cabinet for Economic Development shall manage the Kentucky enterprise fund

to provide capital to small and medium-size, Kentucky-based companies to

undertake feasibility, concept development, research and development, or

commercialization work.

(2) The purpose of the Kentucky enterprise fund is to:

(a) Accelerate knowledge transfer and technological innovation, improve

economic competitiveness, and spur economic growth in Kentucky-based

companies;

(b) Support feasibility, concept development, research and development, or

commercialization activities that have clear potential to lead to commercially

successful products, processes, or services within a reasonable period of time;

(c) Stimulate growth-oriented enterprises within the Commonwealth;

(d) Encourage partnerships and collaborative projects between private enterprises,

Kentucky's colleges and universities, and research organizations;

(e) Promote research and development and commercialization activities that are

market-oriented; and

(f) Support small and medium-sized companies.

(3) The Kentucky enterprise fund shall be used to fund qualified companies in

accordance with this section as follows:

(a) Grants of up to fifty thousand dollars ($50,000) for companies exploring the

feasibility of technology commercialization or projects related to feasibility

studies, such as incubator and accelerator programs;

(b) Funding of up to two hundred fifty thousand dollars ($250,000) for companies

in the concept development phase of technology commercialization;

(c) Funding of up to five hundred thousand dollars ($500,000) for companies

advancing and promoting the program goals, as outlined in subsection (2) of

this section; and

(d) For new investments made on or after July 1, 2021, no qualified company can

receive a total investment from the fund in excess of up to five hundred

thousand dollars ($500,000).

(4) Beginning July 1, 2021, the cabinet shall allocate at least twenty percent (20%) of

the annual allotment of funds for the Kentucky enterprise fund to qualified

companies located in rural or enhanced incentive counties, as certified under KRS

154.32-050, and at least twenty percent (20%) of the annual allotment of funds to

qualified companies located in Opportunity Zones, as designated by the

Commonwealth and certified by the Secretary of the United States Treasury.

(5) For all funding totaling more than thirty thousand dollars ($30,000), the science and

technology organization or any entity designated by the executive director of the

Office of Entrepreneurship and Innovation shall receive an equity interest in the

qualified company, such as a general or limited partnership interest, limited liability

company interest, common or preferred stock with or without voting rights and

without regard to seniority position, forms of subordinate or convertible unsecured

debt, or both, with warrants, rights, or other means of equity conversion attached, a

near equity interest such as a simple agreement for future equity or "SAFE

agreement", or other convertible debt instruments that are determined to qualify as

an adequate investment interest by the executive director of the Office of

Entrepreneurship and Innovation.