Agenda - Council - 10/22/2019 - Laserfiche WebLink

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Franchises Operational Requirements b) The operating small business concern -is an eligible small business and the proposed use of proceeds would be allowable for such assistance if the operating small business concern were the owner of the property that is owned or to be owned by the applicant; c) The ownership interests in the applicant shall be completely identical with and in the same proportion as the ownership interest in such operating small business concern; d) Collateral includes an assignment of the lease between the applicant and the operating small business concern and a lien on the property itself. The lease, including options, shall be for a term of not less than the term of the loan; e) The operating small business concern must be either a guarantor or co -borrower, and any owners of 20% or more of the equity of the operating small business concern and of the applicant must also guarantee the loan. A franchise is eligible for the Oakdale Seed Fund if the franchise has the right to profit from his/her efforts commensurate with ownership and is eligible in all other respects. Franchises are ineligible only in the exceptional cases where the franchise agreement disguised as a contract of employment under the guise of a franchise operation. Where royalty or similar payments must be made by the borrower to the franchisor, a condition should be considered that prohibits such payment as long as the EDA loan is in default. Where credit factors warrant, guarantee of the franchisor should also be considered. Responsibilities of the EDA/Oakdale Seed Fund The Oakdale EDA/Seed Fund will offer its assistance to small business in need of financing. It will cooperate with other lenders participating in projects. The EDA and the Seed Fund are able to: a) Package and process loan applications b) Close and service loans c) Make available management services or cause such services to be made available 57