(m) Eligible business means:

1. (1) a manufacturing firm or agricultural business that has its principal place of business in New York State and that employs 500 or fewer employees within New York State on a full-time basis;
2. (2) a certified business with a facility located in an empire zone, which business has its principal place of business in New York State and which employs 100 or fewer employees within New York State on a full-time basis;
3. (3) any firm seeking financing through the program for an export project, which firm has its principal place of business in New York State and employs 100 or fewer employees within New York State on a full-time basis;

4. (4) any business located in a highly distressed area, as defined herein, which business is not a retail business, has its principal place of business in New York State, and employs 100 or fewer employees within New York State on a full-time basis; provided, however, that a retail business located in a highly distressed area may be considered an eligible business, if the commissioner determines that:

   1. (i) the financing provided through the program will retain permanent, full-time jobs in the highly distressed area; or
   2. (ii) the financing provided through the program will increase the overall number of retail jobs in the local retail market within which the business is located;
5. (5) any certified minority- or women-owned business that has its principal place of business in New York State and is seeking financing necessary to carry out a specific procurement contract with an agency or public authority or other entity of the New York State or Federal governments, provided that a minority- or women-owned business which does not seek financing necessary to carry out such a procurement contract shall not be precluded from qualifying as an eligible business for any other purpose enumerated herein;

6. (6) any service business that:

   1. (i) is not dominant in its field within New York State during the preceding 10 years;
   2. (ii) has its principal place of business in New York State and employs 100 or fewer employees within New York State on a full-time basis;
   3. (iii) is seeking financing for a project that will result in the retention or creation of permanent, full-time, private-sector jobs within New York State;
   4. (iv) does not sell a service rendered at a facility personally by an individual for another individual, directly, without the intervention of a third party, or professional services such as health, legal, accounting, engineering, or architectural services; and
   5. (v) is independently owned and operated; for purposes of this paragraph, independently owned and operated means that the business is not a subsidiary or affiliate of another operating company and is not operated under a franchise or similar agreement; and

7. (7) a qualifying technology or innovation business which business employs 100 or fewer employees within the State on a full-time basis and engages in:

   1. (i) biotechnologies, which shall be defined as technologies involving the scientific manipulation of living organisms, especially at the molecular and/or the submolecular genetic level, to produce products conducive to improving the lives and health of plants, animals, and humans; and the associated scientific research, pharmacological, mechanical, and computational applications and services connected with these improvements;
   2. (ii) information and communication technologies, equipment, and systems that involve advanced computer software and hardware, visualization technologies, and human interface technologies;
   3. (iii) advanced materials and processing technologies that involve the development, modification, or improvement of one or more materials or methods to produce devices and structures with improved performance characteristics or special functional attributes, or to activate, speed up, or otherwise alter chemical, biochemical, or medical processes;
   4. (iv) electronic and photonic devices and components for use in producing electronic, optoelectronic, mechanical equipment and products of electronic distribution with interactive media content;
   5. (v) energy efficiency, renewable energy and environmental technologies, products, devices, and services; or
   6. (vi) small-scale systems integration and packaging.

(n) Eligible projects means:

1. (1) export projects designed to increase a firm's export activities; or

2. (2) for eligible manufacturing, technology or innovation, agricultural, and service firms, projects that involve one or more of the following:

   1. (i) the preparation of strategic plans for improving productivity and competitiveness;
   2. (ii) the introduction of modern equipment and/or the expansion of facilities as part of a business modernization plan;
   3. (iii) the introduction of advanced technologies to improve productivity and quality;
   4. (iv) improvements in production processes and operations, including agricultural operations;
   5. (v) introduction of computerized information, reporting and control systems;
   6. (vi) reorganization or improvement of work place systems and the introduction to total quality and employee participation programs;
   7. (vii) development and introduction of new products;
   8. (viii) identification and development of new markets, including entry into foreign markets;
   9. (ix) financial restructuring for purposes of enabling specific modernization activities, however, refinancing of existing debt solely to obtain a lower interest rate shall be ineligible;
   10. (x) buyouts of viable companies by employees or buyouts of viable companies by local owners residing in New York State;
   11. (xi) provision of working capital for other business modernization activities that will improve the competitiveness and productivity of a firm and result in the creation or retention of permanent, full-time jobs; or
3. (3) for certified businesses located in empire zones, and for eligible retail businesses located in highly distressed areas, projects that will create or retain full-time, permanent jobs within the empire zone or highly distressed area, as the case may be;
4. (4) for defense industry manufacturers, projects designed to reduce dependence on Department of Defense and other military contracts and to change or diversify production in order to take advantage of any market other than that serving the Department of Defense or other military procurers; or
5. (5) for certified minority- and women-owned businesses, projects to provide financing necessary to carry out a specific procurement contract with an agency or public authority or other entity of the New York State or Federal governments. For purposes of this paragraph, procurement contract shall include construction contracts.

(o) Highly distressed area means:

1. (1) a census tract or tracts or block numbering area or areas or such census tract or block numbering area contiguous thereto which, according to the most recent census data available, has:

   1. (i) a poverty rate of at least 20 percent for the year to which the data relates or at least 20 percent of the households receiving public assistance; and
   2. (ii) an unemployment rate of at least one and twenty-five one hundredths times the statewide unemployment rate for the year to which the data relates; or

2. (2) a city, town, village or county within a city with a population of one million or more for which:

   1. (i) the ratio of the full value property wealth, as determined by the comptroller for the year 1990, per resident to the statewide average full value property wealth per resident; and
   2. (ii) the ratio of the income per resident, as shown in the 1990 census, to the statewide average income per resident; are each 55 percent or less of the statewide average;
3. (3) an empire zone shall not be considered a highly distressed area for purposes of this subdivision.

(p) Lender means:

1. (1) any commercial bank that is or shall become an approved depository of State funds by meeting such qualifications and executing such documents as required by an authorized depositor and that agrees to participate in the program as evidenced by executing a linked deposit agreement, provided for in section 160.3 of this Part, with an authorized depositor;
2. (2) any thrift which an authorized depositor determines is eligible to accept linked deposits based upon criteria applied by the authorized depositor in making determinations under section 105 of the State Finance Law, and which agrees to participate in the program as evidenced by executing a linked deposit agreement with an authorized depositor, provided that any linked deposit in such thrift shall be secured in the same manner as moneys deposited pursuant to section 105 of the State Finance Law and such thrifts shall pledge assets or furnish other security satisfactory in form and amount to the authorized depositor for the repayment of moneys;
3. (3) any farm credit system institution which an authorized depositor determines is eligible to accept linked deposits based upon criteria applied by the authorized depositor in making determinations under section 105 of the State Finance Law, and which agrees to participate in the program as evidenced by executing a linked deposit agreement with an authorized depositor, provided that any linked deposit in such farm credit system institution shall be secured in the same manner as moneys deposited pursuant to section 105 of the State Finance Law and such farm credit system institutions shall pledge assets or furnish other security satisfactory in form and amount to the authorized depositor for repayment of moneys; or
4. (4) the New York Business Development Corporation.

(q) Linked deposit means a deposit, or for farm credit system institutions an investment eligible to be held by such institution, placed with a lender by the Comptroller or the Commissioner of Taxation and Finance for a period of four years at a fixed linked deposit interest rate, provided the lender agrees to:

1. (1) lend the equivalent value of such deposit to an eligible business at the fixed interest rate provided in section 218 of the State Finance Law; and
2. (2) permit the deposit to be comprised of a series of 90-day, six-month or one-year deposits each bearing an interest rate equal to the linked deposit interest rate fixed at the time the original deposit is placed.

(r) Linked deposit interest rate means:

1. (1) for a linked deposit made in connection with a linked loan to a certified business in an economic development zone or to an eligible business located in an highly distressed area or to a qualifying technology or innovation business as defined in paragraph (m)(7) of this section or to a certified minority- or women-owned business enterprise for an eligible project defined in paragraph (n)(5) of this section or to a defense industry manufacturer for a project defined in paragraph (n)(4) of this section, a fixed rate of interest which is 300 basis points below the lender's posted four year certificate of deposit rate or, if the lender does not offer a four year certificate of deposit or publicly post its four year certificate of deposit rate, is 300 basis points below the average statewide rate for four year certificates of deposit as determined by the commissioner;
2. (2) for linked deposit made in connection with any linked loan other than those specified in paragraph (1) of this subdivision, a fixed rate of interest which is 200 basis points below the lender's posted four year certificate of deposit rate, or, if the lender does not offer a four year certificate of deposit or publicly post its four year certificate of deposit rate, is 200 basis points below the average statewide rate for four year certificates of deposit as determined by the commissioner.
3. (3) In no event shall the linked deposit interest rate be less than zero.

(v) Retail business means a business that:

1. (1) sells merchandise to the general public for personal or household use or sells merchandise both to the general public for personal or household use and to businesses;
2. (2) buys and receives, as well as sells, merchandise;
3. (3) has an identified place of business and engages in activities to attract the general public to buy merchandise; and
4. (4) to the extent it renders services, does so incidental to the sale of merchandise.

(w) Service business means a business that engages in activities that add value without producing a product and creates intangible outputs rather than tangible goods. For purposes of this subdivision, service business shall not include:

1. (1) a business that sells a service rendered at a facility personally by an individual for another individual, directly and without the intervention of a third party, such as, but not limited to, brokerage of real estate, securities, or insurance; or
2. (2) professional services rendered by licensed individuals, such as, but not limited to, health, legal, accounting, engineering or architectural services.