Small Businesses that may be ineligible for financing.

CFR · 2024-01-01 · US · Title 13

(a) (b) (1) (i) It is not engaged in a regular and continuous business operation (for purposes of this paragraph (b), the mere receipt of payments such as dividends, rents, lease payments, or royalties is not considered a regular and continuous business operation); or (ii) Its employees are not carrying on the majority of day to day operations, and the company does not provide effective control and supervision, on a day to day basis, over persons employed under contract; or (iii) It passes through substantially all of the proceeds of the Financing to another entity. (2) (3) (c) (i) Any business classified under subsector 5311 (Lessors of Real Estate) of the NAICS Manual; or (ii) Any business listed under subsector 5312 (Offices of Real Estate Agents and Brokers) unless at least 80 percent of the revenue is derived from non-Affiliate sources. (2) You are not permitted to finance a business, regardless of NAICS classification, if the Financing is to be used to acquire or refinance real property, unless the Small Business: (i) Is acquiring an existing property and will use at least 51 percent of the usable square footage for an eligible business purpose; or (ii) Is building or renovating a building and will use at least 67 percent of the usable square footage for an eligible business purpose; or (iii) Occupies the subject property and uses at least 67 percent of the usable square footage for an eligible business purpose. (d) (1) The assets of the business are to be reduced or co

official document · source cfr-2024 · id 13:§ 108.720