13 CFR 107.750 - Conditions for financing a change of ownership of a Small Business.

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There is 1 rule appearing in the Federal Register for 13 CFR 107. View below or at eCFR (GPOAccess)
§ 107.750 Conditions for financing a change of ownership of a Small Business.
You may finance a change of ownership of a Small Business only under the conditions set forth in this section.
(a) The Financing must:
(1) Promote the sound development or preserve the existence of the Small Business;
(2) Help create a Small Business as a result of a corporate divestiture; or
(3) Facilitate ownership in a Disadvantaged Business.
(b) The Resulting Concern (as defined in paragraph (c) of this section) must:
(1) Be a Small Business under § 107.700;
(2) Have 500 or fewer full-time equivalent employees; or meet one of the appropriate debt/equity ratio tests:
(i) If you have outstanding Leverage, the Resulting Concern's ratio of debt to equity must be no more than 5 to 1; or
(ii) If you have no outstanding Leverage, the Resulting Concern's ratio of debt to equity must be no more than 8 to 1.
(c) Definitions.
(1) The “Resulting Concern” is determined by viewing the business as though the change of ownership had already occurred, giving effect to all contemplated financing, mergers, and acquisitions.
(2) For purposes of this section, “debt” means long-term debt, including contingent liabilities, but excluding accounts payable, operating leases, letters of credit, subordinated notes payable to the seller, any other liabilities approved for exclusion by SBA and short-term working capital loans (so long as the loans carry a zero balance for 30 consecutive days during the concern's fiscal year).
(3) For purposes of this section, “equity” means common and preferred stock (corporation), contributed capital (partnership), or membership interests (limited liability company).

Title 13 published on 2014-01-01

The following are only the Rules published in the Federal Register after the published date of Title 13.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2014-10-21; vol. 79 # 203 - Tuesday, October 21, 2014
    1. 79 FR 62819 - Small Business Investment Companies—Investments in Passive Businesses
      GPO FDSys XML | Text
      SMALL BUSINESS ADMINISTRATION
      Final rule.
      This rule is effective November 20, 2014.
      13 CFR Part 107

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United States Code
Statutes at Large

Title 13 published on 2014-01-01

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 13 CFR 107 after this date.

  • 2014-10-21; vol. 79 # 203 - Tuesday, October 21, 2014
    1. 79 FR 62819 - Small Business Investment Companies—Investments in Passive Businesses
      GPO FDSys XML | Text
      SMALL BUSINESS ADMINISTRATION
      Final rule.
      This rule is effective November 20, 2014.
      13 CFR Part 107