[PART V.HAWAII TECHNOLOGY INVESTMENT PROGRAM]

 

[§211F-51]  Definitions.  As used inthis part:

"Biotechnology" means fundamentalknowledge regarding the function of biological systems from the macro level tothe molecular subatomic levels that has application to development includingthe development of novel products, services, technologies, and subtechnologiesfrom insights gained from research advances that add to that body offundamental knowledge.

"Computer data" means anyrepresentation of information, knowledge, facts, concepts, or instructions thatis being prepared or has been prepared and is intended to be processed, isbeing processed, or has been processed in a computer or computer network.

"Computer program" means an orderedset of computer data representing coded instructions or statements, that, whenexecuted by a computer, causes the computer to perform one or more computeroperations.

"Computer software" means computerdata, a computer program, or a set of computer programs, procedures, orassociated documentation concerned with the operation and function of acomputer system, and includes both systems and application programs andsubdivisions, such as assemblers, compilers, routines, generators, and utilityprograms.

"Financial organization" means anorganization authorized to do business in Hawaii that is:

(1)  Certified as an insurer by the insurancecommissioner;

(2)  Licensed or chartered as a financial institutionby the commissioner of financial institutions;

(3)  Chartered by an agency of the federal government;

(4)  Subject to the jurisdiction and regulation of thefederal Securities and Exchange Commission; or

(5)  Any other entity otherwise authorized to dobusiness in the State that meets the requirements of this part.

"Program" means the Hawaii technologyinvestment program.

"Program manager means a financialorganization selected by the corporation to manage the program.

"Qualified high technology business":

(1)  Means a business, employing or owning capital orproperty, or maintain­ing an office, in this State that:

(A)  Conducts more than fifty per cent of itsactivities in performing qualified research in this State; or

(B)  Receives more than fifty per cent of itsgross income derived from qualified research; provided that the income isreceived from:

(i)  Products sold from, manufactured in, orproduced in the State; or

(ii)  Services performed in this State.

(2)  Does not include:

(A)  Any trade or business involving theperformance of services in the field of law, architecture, accounting,actuarial science, consulting, athletics, financial services, or brokerageservices;

(B)  Any banking, insurance, financing,leasing, rental, investing, or similar business; any farming business,including the business of raising or harvesting trees; any business involvingthe production or extraction of products of a character with respect to which adeduction is allowable under section 611 (with respect to allowance ofdeduction for depletion), 613 (with respect to basis for percentage depletion),or 613A (with respect to limitation on percentage deplet­ing in cases of oiland gas wells) of the Internal Revenue Code;

(C)  Any business operating a hotel, motel,restaurant, or similar business; and

(D)  Any trade or business involving ahospital, a private office of a licensed health care professional, a grouppractice of licensed health care professionals, or a nursing home.

"Qualified research" means:

(1)  The same as in section 41(d) of the InternalRevenue Code; or

(2)  The development and design of computer softwareusing fourth generation or higher software development tools or nativeprogramming languages to design and construct unique and specific code tocreate applications and design databases for sale or license; or

(3)  Biotechnology;

provided that more than fifty per cent of thebusiness' activities are qualified research.

"Venture capital investment" meansany of the following investments in a qualified high technology business:

(1)  Common or preferred stock and equity securitieswithout a repurchase requirement for at least five years;

(2)  A right to purchase stock or equity securities;

(3)  Any debenture or loan, whether or not convertibleor having stock purchase rights, which:

(A)  Is subordinated, together with securityinterests against the assets of the borrower, by their terms to all borrowingsof the borrower from other institutional lenders;

(B)  Is for a term of not less than threeyears; and

(C)  Has no part amortized during the firstthree years;

(4)  General or limited partnership interests; and

(5)  Membership interests in limited liabilitycompanies. [L 2000, c 297, pt of §33]