Tag Archives: Small Business Administration (SBA)

The New SBA Addendum

Effective January 1, 2017, any franchisor that wants to offer SBA guaranteed financing for its franchisees will use a single, two-page form addendum.   In a notice issued just before Thanksgiving, the SBA announced that it will no longer review franchise agreements to determine whether affiliation exists between the franchisor and franchisee in any specific franchise system.  Previously negotiated SBA addenda will no longer be accepted. SBA loans are only available to independent small businesses as defined in the SBA regulations.  Some franchisors impose a level of control in the franchise agreements that the SBA considers to create “affiliation” between the franchisor and …

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SBA Requests Comments on Franchise Loan Program

The U.S. Small Business Administration (SBA) is requesting comments from the public on all aspects of its franchise lending program.  The SBA issued its notice and request for comment December 8, 2014.  Comments must be submitted no later than February 6, 2015. The SBA guarantees bank loans to franchisees that apply and qualify under certain SBA lending programs.  The SBA guarantee makes it possible for franchisees that otherwise would not qualify for a loan to finance their franchise businesses.  But not all franchise agreements fall within the scope of the SBA requirements.  Some franchise systems have provisions in their franchise …

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